TNI Editorial: How To Fix The Scalper Problem - The Power Is Within YOU!

Editorial

by Jay Cochran
July 22, 2020

There is no denying that the hobby of action figure collecting is facing a bit of a crisis with scalping these days. More and more, collectors find it difficult to get their hands on the products toy manufacturers are producing at reasonable prices.

First, let’s clearly define what a scalper is in the context of this problem. A scalper is someone (or someones) who buy all or most the product they can find at regular retail with the intent of reselling it at a marked up price for profit. The mark up is generally double the original price, although items perceived as high demand sometimes can be marked up even more. eBay is the most common place the scalpers go to resell their stuff.

Scalpers have always been around and frankly always will be around as long as perceived demand for an item exceeds supply. However, as toy manufacturers turn more and more to store exclusives and technologies like online bots that allow scalpers to clean out website stock in seconds improve, the scalper problem is only getting worse. So what can be done about it?

Seeing toy manufacturers quit giving stores so many exclusives would be nice, but such an expectation in today’s limited retail landscape is seemingly neither practical or realistic. Toy Manufacturers increasingly are beholden to their largest customers, which are the Target’s and Walmart’s of the world, especially when talking about the larger companies like Hasbro. Expecting them to turn their backs on the big box retailers is like expecting someone who has been wandering the desert for days to turn away a canteen filled with water. It would be suicide for them to do it.

Seeing the big box retailers implement counter-technology on their websites to prevent the scalper bots from cleaning out inventory or putting in place policies that limit purchase quantities to one or two would be cool, but also is unlikely. First, implementing new website countermeasures means the retailer has to spend money to update the websites. Second, it’s really not in their best interest if something like an exclusive is easy to find. To understand why I say that, you first have to really understand why these stores want the exclusives in the first place. The primary reason for making highly sought items an exclusive is to pull you through their doors. They really don’t care if you find said exclusive. In fact, it’s counter-productive if you find the exclusive on your first trip. If you have to keep coming back to the store multiple times, so much the better. The idea is browsing - once you are in the store, you will buy something. Also, a sale is a sale, whether the buyer is a scalper or a collector. The whole psychological impact of the perception that something is rare and valuable is another bonus for them. In my view, collecting (really anything) taps into the addictive impulses of wanting something others don’t have. The harder-to-get something is perceived the more people want it, hence the increased demand for an item that might not otherwise be there. It’s not really logical, but it is human nature.

Now I can’t sit here and tell you retailers are deliberately keeping inventory low on these exclusives so you can’t find them, but you certainly can see the benefit to them if something is harder to find, causing you time and again to come to them for what you seek.

So if we can’t really count on the toy manufacturers or the big box retailers to fix the problem, where do we collectors go from here?

Well, the answer is simple and difficult all at the same time. As I mentioned before, perceived demand of limited supply will always create profiteers. So the goal is simple. Don’t let them profit. If collectors quit buying toys from scalpers, the scalper will be left with unsold inventory. Like with any retail business, if your inventory doesn’t move then you go out of business.

A scalper is only going to scalp something if they think they have a fair chance of reselling that item at a marked up price. If they are not able to sell an item for more than what they paid, they will move on. In fact, if they have to sit on lots of unsold inventory for any significant period of time, eventually they will be forced to discount the stuff just to clear it out.

Now the tricky part is getting people to quit buying from scalpers. It sound easy, but it’s not really. No matter how many times you hear people say “don’t feed the scalpers”, there are always those who seem to do just that. Of course, there is no way to force people not to buy from scalpers.

So once again, how do we go about fixing the problem? Honestly, I don’t think a silver bullet solution exists, and we will likely never completely fix the problem. But here are a few easy recommendations that may help reduce the problem.

1. First and foremost, remember these are just action figures. If you don’t get it, the world isn’t going to end. Yes, collecting can be an addiction, but don’t let it rule your life. Be willing to walk away if you need to.

2. Remember, you really do have the ultimate power with your wallet. You can’t stop a determined scalper from buying stuff, but if they can’t sell it at a profit they will have no choice but to stop buying it. It’s all about supply and demand, and while we have little control over the supply side of the equation, we do have significant control on the demand side.

3. As collectors we all are in this together - and as with anything, the more united we are, the stronger we are. Don’t let your frustration turn to anger. Look to each other for help in finding stuff. Create networks where you can share information like area reports or even obtain toys for one another at cost. If we make the hobby less about the physical items themselves and more about the relationships and friendships that can be built while collecting these things, it will bring the fun back even if you end up missing out on a figure here or there.

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Comments...

Last 10 comments - ( Read All Posts )

lazrod - 2020-09-15 @ 6:20 pm

10 hours ago, Atlantis said:
Recent youtube reports that Hasbro may be discontinuing its GI JOE exclusive with Target. Its not totally confirmed yet, and we dont know exactly what that will mean if it is confirmed, but my hope is Hasbro will immediately distribute it to all outlets, BBTS, Amazon, local dept stores that usually carry these action figures, etc. If they were to do this not only would we all have a better shot to get the figures we want, its gonna be a big blow to the scalpers. All the figures they bought up, planning to re-sell at 2-3x the actual fair price, they'd then just be stuck with. I'd love to see them get clobbered for a change.
But no matter what, the scalper problem is NOT all on us. People need to show theyre willing to walk away and not feed these scalpers, 100%. At the same time, this mess is squarely on Hasbro and Target, and I blame Hasbro more, because its their product, their brand, and they need to step up to fix it. Hopefully.....theyre listening.
https://www.youtube.com/watch?v=qv1ugiedEhI
https://www.youtube.com/watch?v=txCHRDpWKSw

Everything you say makes perfect sense and I sure hope it happens. But I doubt it will, precisely because it is what makes the most sense......

K9K1N6 - 2020-09-15 @ 4:39 pm

1 hour ago, Mr_Scary92 said:
Honestly I doubt it, I've seen how Hasbro MX handles all the collector lines and the only one that seems to take precedence is Marvel Legends, Star Wars would come in a very distant background and then everything else. For example they're going to carry some quantities of that overpriced ML Sentinel from the Haslab project but there's no info about GI Joe Classifieds wave 2 coming anytime soon or the remaining waves of the Lighting Collection despite the psycho rangers pack and that wierd one wheeled bike went on pre order in Amazon and has been many months since I saw any Black Series being stocked up in some store. The distribution is simply irregular.

Good point there.

ghostbogey - 2020-09-15 @ 4:30 pm

I read JayC post when he posted it...(really good read)

Like him.....My answers has always been "Don't buy " when they pass your price point or your "principle" point.

That's the bottom line...There always going to be Scalpers. From the "corner the market" types (what JayC voiced)

or people who purchase extras...When you buy 2 Limited Exclusives are you a Scalper or Just Greedy?

Some poor guy can't get his 1. Did you need two? Did you think about that guy? Probably not.

I guess you would just tell him; You Slow you Blow dude. Talk to the Scalpers. =^)

Just a thought, Greed makes people do all kinds of things...Ask a scalper =^)....Just, IMHO..

K9K1N6 - 2020-09-15 @ 9:41 am

I do hope too that Hasbro can distribute it to other stores,heck even to other countries as well (i am looking at you mexico, if they ever bother to do so), but of course this is just a rumor and I'll wait to see if Hasbro will ever mention this or whatsoever.

Atlantis - 2020-09-15 @ 7:31 am

Recent youtube reports that Hasbro may be discontinuing its GI JOE exclusive with Target. Its not totally confirmed yet, and we dont know exactly what that will mean if it is confirmed, but my hope is Hasbro will immediately distribute it to all outlets, BBTS, Amazon, local dept stores that usually carry these action figures, etc. If they were to do this not only would we all have a better shot to get the figures we want, its gonna be a big blow to the scalpers. All the figures they bought up, planning to re-sell at 2-3x the actual fair price, they'd then just be stuck with. I'd love to see them get clobbered for a change.

But no matter what, the scalper problem is NOT all on us. People need to show theyre willing to walk away and not feed these scalpers, 100%. At the same time, this mess is squarely on Hasbro and Target, and I blame Hasbro more, because its their product, their brand, and they need to step up to fix it. Hopefully.....theyre listening.

https://www.youtube.com/watch?v=qv1ugiedEhI

https://www.youtube.com/watch?v=txCHRDpWKSw

SclassHiei - 2020-08-29 @ 3:38 pm

I refuse to purchase from scalpers I don't care how badly I want something. This is a great read and so many great replies. The thing I hate is there are people who just don't care and will pay $120 for a $60 figure.I remember when the Walmart exclusive marvel legends Captain America worthy was released those things were selling crazy on ebay for $80 I couldn't get any of the sdcc exclusive dbz figures when they were available for $50 now all three of them are on ebay $150 I refuse to buy them I'd rather just watch a video review and be happy for a real collector who owns them I haven't purchased figure from eBay in almost 2 years

Atlantis - 2020-08-26 @ 4:21 pm

Ran across a youtube review yesterday; the guy admitted he gave in to scalpers because he didn't want to deal with mess involving GI Joes. He tried to justify spending 2-3x what these are retailing for. I didn't watch the entire thing because it nauseated me to listen to some fool actually strut about being a weak slave to someone's selfishness and greed. I get wanting to have the toys but, damn, dude, show some self respect....

JayC - 2020-08-04 @ 3:09 pm

30 minutes ago, Thunder_Razor said:
There is a lot more to add to the article. The problem is much more deep than it seems. I'm an international collector. I must rely on stores that sell abroad, but since my country over taxes the products from abroad, I use eBay to buy things. Even buying from scalpers, most of time, the figures cost less than buying them from official stores. Me and most of collectors abroad don't have the chance to buy the figures we want in our countries, so eBay is the best, and some times, the only solution. This feeds the scalpers more than anything. There are people with shitloads of money around the Globe, and are willing to pay whatever it costs to have what they want. Some people also like to buy just to show off, and won't save money to do that.
Yesterday, selling something rare was a job, very respectable. People would go to an Antique Store, and the seller usually tells a story about that product and justify why that was expensive. For example, I would think that Toybiz Marvel Legends series 1 should be sell for more than 1000 USD. Those figures have an history, they started it all in therms of 6" figures (I'm disregarding Spiderman classics for a reason), super articulated, the very standard of the industry nowadays. Today we have eBay,and it is not about Antiques, it is about interest, scalpers have rare items and wait until they see someone selling a similar item for a given price. Then, they put theirs on sale for more, if that sells, the other scalper sell it for more, and so forth...
So, the easier solution was distributing items worldwide, with enough quantity that everyone get what they want. But that is not that simple. The production costs of figures is not cheap, and even a highly demanded figure is going to be a peg warmer if it is over manufactured. Doing what is considered "enough" quantity is also a problem, because scalpers are not dumb, they know the business, and they know what is more demanded, and just buy it all, or all they can. This is true for the new GI Joe line, GI Joe collectors are known for spending lots of money for their collections, so the natural move was buying everything they can and re-sell for an insanely amount of money. So, if figures sold out, they end up in the hands of scalpers, and they charge whatever they want, if figures become peg warmers, then, the companies loose a lot of money, and end up giving up the line...
Is there a solution for scalper problem? Yes, there is one, and that solution cannot rely on the collector only. There is no control of people worldwide that cannot buy what they want locally, or people that just want to flex their collections. Auction sites, like eBay should have limits to the price charged, I don't know how much, but should have a limit. They may leave the bidding going on limitless, but the "buy it now" should be cut down, with a button to report the seller if he disrespect the rules. Re-sellers, like Amazon, should also put a limit on the stores that sell through their platform. It worked beautifully during the first months of the Coronavirus pandemic, with scalpers cleaning out drugstores everywhere and re-selling in Amazon for 3 times the actual cost. They just permanently ban those sellers and they ended up sitting on a pile of products they want to scalp people... Those things would not solve the problem, but they would certainly reduce the range of the scalpers...
Sorry about my English, it is not my native language...

Your right in that it gets even more complicated when it comes to International, but IDK how many US scalpers thrive on international sales. Truth is though in recent years I am seeing this stuff more easily obtainable for those outside the US than those who live in the US.

JayC - 2020-08-04 @ 3:05 pm

On 8/2/2020 at 12:08 PM, henryce1973 said:
Im sorry but this whole article, while painting an accurate picture of the problem, sounds more like a scalper apologetic when it comes to the solution. Just dont but from them isnt a realistic answer if collectors want to continue to be in the collecting game. Scalping in my area has become such a huge problem that one could say the manufacturers may as well be sending their entire inventory directly to the scalpers. And its not just individual scalpers. There are stores here that actually send their employees out on a daily basis to make sure collectors have no choice but to go to them at a significant markup. The entire collecting market (in the 7th largest city in the country no less) around here istotally controlled by the same 4 scalpers and two stores, who hit every Target,Walmart, and Walgreens within an 84 mile, 3-city span almost daily.While it may be true that manufacturers have an interest in partnering with stores, and vice versa, how long will that interest last if the collectors just quit altogether, which is what I see happening here more and more. The idea that people will shop in a store more often if theyre hunting for exclusives is laughable. People hunting for exclusives dont spend any appreciable time in any one store. They run inside, head straight for the home shelf, find it empty, then run right out on their way to the next Store, hoping to find whatever scraps the scalpers may have left (by accident, Im sure). Stores and manufacturers absolutely MUST do more to prevent scalping, otherwise scalpers with no customers is all theyll have left, and a scalper with no customers will abandon the hobby also, leaving no audience for the product. Ill tell you what Ive had to resort to...if I somehow walk into a store at just the right time and find the exclusives on the shelf, I take the one with damaged packaging since Im an open to display collector, then I intentionally damage the packaging of exactly half of whats left, making the items less marketable to scalpers but now accessible to those who want to open and display. It that a crap move? Probably. But thats what the hobby has become.

Sure the simplest solution would be for the manufacturers to produce enough inventory and the retailers to carry the inventory in the numbers to ensure there was enough supply to fill demand, but the retailers wont do that cause they dont want to be stuck with unsold inventory. The truth is we have no control over what Walmart ,Target or even the manufactures do beyond simply not buying the stuff at all, which is kinda like burning down the house to kill the spider. We do however very much have control over our own actions, and so using your example, if everyone in your area quit buying the stuff from these 4 scalpers and 2 stores you mentioned sending employees out, then they would be the ones stuck with the unsold inventory and I guarantee if that were the case they wouldn't be running out to the stores to clear the shelves for much longer.

Thunder_Razor - 2020-08-04 @ 2:43 pm

There is a lot more to add to the article. The problem is much more deep than it seems. I'm an international collector. I must rely on stores that sell abroad, but since my country over taxes the products from abroad, I use eBay to buy things. Even buying from scalpers, most of time, the figures cost less than buying them from official stores. Me and most of collectors abroad don't have the chance to buy the figures we want in our countries, so eBay is the best, and some times, the only solution. This feeds the scalpers more than anything. There are people with shitloads of money around the Globe, and are willing to pay whatever it costs to have what they want. Some people also like to buy just to show off, and won't save money to do that.

Yesterday, selling something rare was a job, very respectable. People would go to an Antique Store, and the seller usually tells a story about that product and justify why that was expensive. For example, I would think that Toybiz Marvel Legends series 1 should be sell for more than 1000 USD. Those figures have an history, they started it all in therms of 6" figures (I'm disregarding Spiderman classics for a reason), super articulated, the very standard of the industry nowadays. Today we have eBay,and it is not about Antiques, it is about interest, scalpers have rare items and wait until they see someone selling a similar item for a given price. Then, they put theirs on sale for more, if that sells, the other scalper sell it for more, and so forth...

So, the easier solution was distributing items worldwide, with enough quantity that everyone get what they want. But that is not that simple. The production costs of figures is not cheap, and even a highly demanded figure is going to be a peg warmer if it is over manufactured. Doing what is considered "enough" quantity is also a problem, because scalpers are not dumb, they know the business, and they know what is more demanded, and just buy it all, or all they can. This is true for the new GI Joe line, GI Joe collectors are known for spending lots of money for their collections, so the natural move was buying everything they can and re-sell for an insanely amount of money. So, if figures sold out, they end up in the hands of scalpers, and they charge whatever they want, if figures become peg warmers, then, the companies loose a lot of money, and end up giving up the line...

Is there a solution for scalper problem? Yes, there is one, and that solution cannot rely on the collector only. There is no control of people worldwide that cannot buy what they want locally, or people that just want to flex their collections. Auction sites, like eBay should have limits to the price charged, I don't know how much, but should have a limit. They may leave the bidding going on limitless, but the "buy it now" should be cut down, with a button to report the seller if he disrespect the rules. Re-sellers, like Amazon, should also put a limit on the stores that sell through their platform. It worked beautifully during the first months of the Coronavirus pandemic, with scalpers cleaning out drugstores everywhere and re-selling in Amazon for 3 times the actual cost. They just permanently ban those sellers and they ended up sitting on a pile of products they want to scalp people... Those things would not solve the problem, but they would certainly reduce the range of the scalpers...

Sorry about my English, it is not my native language...

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