Hi, I would greatly appreciate it if you would please mark at the bottom if this was helpful to you. Thanks.
This has nothing to do with buying it and keeping it for yourself, this is about the profitability of selling it on eBay. Anyways, on to the guide....
Last Winter I sold the XBOX 360s throughout the Christmas season. I sold the Premium XBOX 360 on the release date which sold for $700, and I sold 2 more the week before Christman for $600 each. Each time I bought one I had to stay outside for 24 hours straight, in freezing cold Chicago weather, one time it was just below freezing with mild winds, the other time it was 10 degrees, with fierce winds. Now many people are wondering if they should do the same thing for the PS3. Considering the economics behind selling consoles such as this first we have to determine the demand of the gaming consoles.
Knowing that the gaming console in high demand will cost $600 plus tax, so around $650 in total cost, for each gaming console. Now to be able to sell this for a profit we can't just sell it for $650, because there are many other expenses that we will have concured upon us, such as shipping, eBay starting fees, eBay ending fees, and PayPal fees. Shipping overnight will cost around $100, but you can ship it on the ground for as little as $30, not including insurance, and insurance on such an expensive thing is highly recomended. eBay insertion fees are going to cost you $4.80 just to set a reserve on your item to make sure you don't lose any money, because selling on eBay is always a gamble. This doesn't even include the cost for a gallery or a featured item, so it could end up costing you anywhere from $.55 to $20 . For the final fee, ebay charges you 5.25% of the initial $25.00 ($1.31), plus 3.00% of the remaining closing value balance ($25.01 to $1,000.00). The final fee for a playstaion 3 selling at $700 would cost $22.31. OUCH. Thats expensive. PLUS you have to pay a PayPal fee if you use this service. Most buyers on eBay don't trust sending large amounds of cash via the mail or money order, so PayPal is a must. PayPal charges 2.9% on all money being sent into a persons account, plus 30 cents. Of a $700 sale, PayPal would charge $20.60. Thats a lot of money. So if you add up all of the expenses just to sell a PS3 on eBay for $700 you would end up paying $697.71. Meaning you would only profit $2.29. But this is just if the console only sells for $700.
Lets determine the cost of an item with all these expenses selling for $900. First we have the console which is $650. We have the ebay reserve fee, $4.80. We have the eBay closing fee which is $28.31. Then we have shipping, we'll be cheap shippers and only pay $30 for shipping. And then on top of this all we have PayPal fees, which would cost $26.40. Adding all these fees up, our grand expense is: $739.51. Can you say OUCH!! Subtracting that number by our sale, we earn $160.49 for staying outside in the cold all night long burrrr. Kinda sounds like a waste of time to me, just for this small amount of money. Seriously how many people would be willing to spend $900 for a console?? I can't think of too many people.
On top of the high expense rate of selling the console. Is the demand going to be as high as the XBOX 360? Well considering the history of video game consoles, NO. If you look at the sales of the first console comming out each generation of consoles, the first console to hit the market always sold way better than the others. Lets go back to the mid 90s. The first console to come out was the N64, everyone knows how well this console did. It was one of the best gaming consoles in history, it was such a revolution to have a 3D world. Next came the PS1, this console did ok for its debut, but didn't come close to meeting that of the N64. The next generation of consoles was the PS2, this console sold outstandingly well. The demand on this was outrageously high. A year later, the XBOX 1 and GameCube came out, both around the same time. Has anyone wondered why the GameCube did so poorly on Launch compared to the N64?? Its because it got a late start, so did the XBOX 1. I bought a GameCube on Launch date back in 2001. There was no line what so ever. My buddy bough one on the launch day at 5 PM that night, just shows how little demand there was for it. Mainly due to the fact that it was launched a year later than the PS2. Now since the PS3 is being launched a year later than the XBOX 360, how can anyone predict how well it is going to do. Who knows? For all we know, the shelves could be packed with them, due to a low demand.
On top of the fact that the console is $600, you also have to add in the cost of games. We know that XBOX 360 games are $60, and some as expensive as $70. In european money XBOX 360 games are 40 (currency, they're not cheaper, its just how their money equates to the US's currency). There's this website selling PS3 games for 50 european currency. This is a 25% increase from XBOX 360 games. If this is rate accurate/truthful, this would mean that PS3 games would cost around $75 each. Thats a lot of money, almost $100 for a game. I know inflation increases, but this is a major jump from selling PS2 games at $50 each.
So in conclusion, selling anything on eBay is a gamble, but before you decide to sell anything, determine your costs and expenses. I personally am not going to be selling any PS3s due to the lack of profit that I would be making, for I doubt that any average American would pay $900 for a silly gaming console. Like what I say or not, its the truth, and selling this console on eBay is a huge mistake and a major gamble with your money. I can not dictate what you do with your money but I can make you aware of the possible outcomes. Like anything this is an INVESTMENT, half the time you win, and half the time YOU LOSE.
Orignal From: Why Selling PS3 at launch on eBay is a very bad idea
No comments:
Post a Comment