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Buried Treasures


June 08, 2001|By JASON ZARA, Staff Writer

In most retail sales, the price of an item can be determined through something of a formula. It costs x amount to create something.

The manufacturer marks it up and sells it to the distributor, who marks it up and sells it to the retailer. The retailer marks it up again and sells it to the consumer. So while the price has been increased a number of times by the time it reaches the retail market, there is at least some basis for the price.

If a television is $200 on the retail market, it may have cost the retailer about $140, the distributor about $80 and the manufacturer about $40.

In collectibles, this process is thrown out entirely. Most of the cost of creating collectibles is in time and talent — actual manufacturing and materials are rarely more than pennies on the dollar. So this has led to an interesting debate.


The newest Dungeons & Dragons system has three core books that sell for about $20 each. They are nice, hardbound books, and seem to be a good value. But as the supplements have continued to be released, they have been progressively more expensive for less material. The latest book is a hardbound similar to the core books, but it costs $40.

The manufacturer, distributors and most retailers would argue this is a great thing for the industry. It is secondary material, so not everyone has to have it, but the people who want it will have no choice. The industry says "isn't this great? We can make twice as much money on this as on anything else."

Frankly, I think it is ridiculous. Yes, the profit margin is nice, but I would rather see the market supporting something that is a good value for the cost than something that is as expensive as can be gotten away with.

No longer is the cost of the talent, time invested and materials relevant — it seems the trend is to decide how much money you want to make and how many copies of a product you think you can sell. Then divide your profits by your quantity and you get a price. No matter how exorbitant, if that's what it takes to put $1 million in your bank account, that's what you charge.

If there was one useful thing in high school algebra, it was the formula for declining returns. There is more money to be made, and at less expense to the individual, in selling 10 books at $30 than there is in selling five at $40.

Unfortunately, somebody in marketing (who probably slept through high school algebra) said "Wow, they'll pay $40 for this? Great, let's do it."

The really unfortunate part is Dungeons & Dragons is making millions of dollars. Yes, there are those who are refusing to buy the $40 book. And there may even be those who are refusing to sell it. But in the end that hurts those few, who may still have their integrity (not to mention their 40 bucks), but don't have the latest and greatest toys to hit the industry.

And so before too long, they'll give in. Because if nothing else, there's always the chance that the book will go up in value.

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