I have a few questions about the loophole.

#1JackofSpades209Posted 7/30/2011 6:44:20 PM
Sorry for another loophole question, but....

So on Aug 12th, the price drops, we all know that, Let's say I go to Wal Mart and I buy a 3DS on Aug 11th, and I go back on the 12th and show my receipt and I get my 20 free games and the $170 price.


But Let's say I go to Wal Mart on Aug 11th and I see 3DS's for $250 and I dont buy one, then I go back the next day and I see the same exact 3DS's for $170

So now my questions

1) Does Wal Mart still lose out on the $80 if I don't buy the 3DS because the price dropped?

2) Did Wal Mart already purchase the 3DS for, let's say $230 from nintendo and now Wal Mart has to sell the 3DS for $170, so does Wal Mart still have a loss?

3) Does anyone know how much profit retailers receive for selling a 3DS at $250?

I dont know how things work between nintendo and retailers, so I'm asking these questions. And I apoligize for any misspellings and I know some people don't like the format I type..

Thanks in advance!
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#21shadetail1Posted 7/30/2011 6:54:53 PM
Generally, retailers buy items in bulk at a discount and then mark them up. You know that phrase "Manufacturer's Suggested Retail Price" (abbreviated MSRP)? The manufacturer suggests that price as a reasonable mark-up to let the retailer make a decent profit.

So any units bought before the price drop *will* end up being sold at a loss after the price drop if the new MSRP is lower than the previous bulk-purchase price. What the retailer counts on is being able to continue selling units bulk-purchased after the price drop to cover any loss.

All that said, the above is a very simplified bare-bones scenario. It can get a lot more complex depending on any agreements between the retailer and manufacturer. For example, in some fields (particularly movies and books), it is common that unsold stock can be returned to the manufacturer for a full refund. Retailers can also receive a price-match-rebate of their own in the event of a price drop. I couldn't tell you what kind of deal Nintendo might have with electronics/gaming retailers.
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#3TrentHawkinsPosted 7/30/2011 7:19:20 PM

From: 1shadetail1 | #002
Generally, retailers buy items in bulk at a discount and then mark them up. You know that phrase "Manufacturer's Suggested Retail Price" (abbreviated MSRP)? The manufacturer suggests that price as a reasonable mark-up to let the retailer make a decent profit.

So any units bought before the price drop *will* end up being sold at a loss after the price drop if the new MSRP is lower than the previous bulk-purchase price. What the retailer counts on is being able to continue selling units bulk-purchased after the price drop to cover any loss.

All that said, the above is a very simplified bare-bones scenario. It can get a lot more complex depending on any agreements between the retailer and manufacturer. For example, in some fields (particularly movies and books), it is common that unsold stock can be returned to the manufacturer for a full refund. Retailers can also receive a price-match-rebate of their own in the event of a price drop. I couldn't tell you what kind of deal Nintendo might have with electronics/gaming retailers.


Considering N.'s asked them not to price match, there's almost certainly no chance of a price match rebate. The price difference is going to be the retailers' responsibility.
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#4KyoskuePosted 7/30/2011 7:30:30 PM
TrentHawkins posted...
Considering N.'s asked them not to price match, there's almost certainly no chance of a price match rebate. The price difference is going to be the retailers' responsibility.

Huh?
Did they really?
I actually didn't expect that.
Source?
#5TrentHawkinsPosted 7/30/2011 7:39:50 PM
Someone here said they emailed nintendo about it and they said they're asking stores not to do price matching. So I guess not 100% confirmed but it makes sense.
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#61shadetail1Posted 7/30/2011 7:50:31 PM
I would be quite astonished if Nintendo doesn't have some kind of "compensate for the price drop" arrangement with the retailers. Considering how fast electronics drop in price, and how small retail profit margins tend to be, it's almost impossible for an electronics retailer to stay in business if the manufacturers don't do that.
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#7TrentHawkinsPosted 7/30/2011 9:38:43 PM

From: 1shadetail1 | #006
I would be quite astonished if Nintendo doesn't have some kind of "compensate for the price drop" arrangement with the retailers. Considering how fast electronics drop in price, and how small retail profit margins tend to be, it's almost impossible for an electronics retailer to stay in business if the manufacturers don't do that.


Under normal circumstances, yes, but if they are telling retailers not to do price matching I'm guessing that also includes "You're on your own if you do" at the very least.
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