Everyone understands prices: We may not agree with prices but we understand them. A price is simply the amount of money being asked for a given object, and and it will generally fall into a range determined by other prices available for that same item. Let’s take Cosmic Encounter, for example: looking at BoardGamePrices.com, (a great utility for pricing games; full disclaimer, we have our games listed on it), Cosmic Encounter at the time of this writing has prices ranging from $45.90 to $61.87. If a seller is asking for anything in that range from people, the seller is probably asking for a fair price. If the seller is asking for anything significantly higher or lower than that range, he/she is asking for too much or too little. Determining a suitable range of prices is only truly difficult in situations where there are not sellers of items comparable to your item …and in that case there are two ways to look at it: Either (1) the price should fall into the range of past historical sales of that item, or, alternatively, (2) since no one else is selling it now, a seller may ask any price at all.
Unfortunately, trading games is much harder. To the best of our knowledge, we’re the only business out there that trades games on any serious level. There are a few shops out there that will take used games for credit (which we’ll do as well), but we have yet to encounter any other store that trades routinely and systematically (ie. rather than doing the occasional game swap here and there). This lack of comparison to other similar systems means that most people will choose some form of currency-based price as their reference when valuing titles (eg. MSRP, retail prices, Amazon, used game prices on the BoardGameGeek marketplace or ebay, etc.). Irrespective of the the fact that every one of those options can have drastically different pricing, trading for games is very different than buying games; and in my opinion, none of those options are a good metric to go by. To make matters worse, since there’s no money involved in a typical trade (ie. it’s just games for games), both sides/parties must agree on values rather than just a buyer.
As a game store whose main activity is trading, BGC wrestles with game valuations constantly.
One of the main factors that we’ve been trying to deal with is supply and demand, or “hotness”. The most common example of ‘the hotness problem’ that I often use is Arkham Horror and Eldritch Horror. Both of those games have the same MSRP, and they generally sell for the same amount in any store. To many people, that means the two are the same value and a fair exchange. I drastically disagree. On BoardGameGeek, there are 1300 people trading Arkham Horror and only 500 wanting, which means that when trading the game, all those 500 people can have their wants fulfilled with a full extra 800 copies will still be lying around ready to trade. Eldritch Horror, by contrast, has 300 copies for trade and 800 people wanting it, which means 500 of those 800 people will not be able to trade for the game and will be forced to pursue other means of acquiring it. If one wants to buy a given game, its value is its price – as long as that game is in print ; however, if one wants to trade for a game, one must account for supply and demand during the valuation.
So over the past few years we’ve been working on a set of formulas for trading. These formulas take into account the following factors and assigns each game a value, so that we can publish a price list and hopefully make trading with us – and for the hobby – an easier proposition.
- MSRP – This is the initial starting point of the value
- Demand – Based on how available a game is, the initial value is modified to be either higher or lower than the MSRP, the demand takes into account both how many people want and are trading, as well as the ratio of how many people want compared to trading.
- Whether we want the game/are overstocked – If we’re overstocked on the game and don’t want it, we’ll still take it but the value will take a big hit. At the end of the day if we have dozens of surplus copies of game X, then it’s worth less to us.
- Our Uptrade – We generally aim for a 25% uptrade, so we assign a downwards adjustment to the point values of the games that we are taking in. This is the most common reason why Game X will be 60 points for our copy and 45 points for your copy.
- An OOP Modifier – This one we rarely use, but sometimes a game needs a manual adjustment to account for either being overstocked, or flooding the market on discount games. So we add a custom modifier here to adjust the value.
Once those 5 factors are taken into account, each game we have and want gets a value. For example, at the time of this writing Arkham Horror we value at 19 points, and Eldritch Horror at 87 points. You can find our app with those values here. It’s still in Beta and we’re constantly improving it; fair warning that the initial load time can be a bit long because it involves accessing BoardGameGeek’s API.
So why is game valuation an exercise in futility? Because I can refine our system endlessly, but other people don’t always agree with those values (which I’m fine with), and some even think that we’re trying to rip them off (which I’m not fine with) and I certainly don’t expect people to read multiple paragraphs worth of explanations before every trade. It also doesn’t help that inherently there will be far more people upset that I’m “lowballing” their Arkham Horror then there will be people surprised at how high I’m valuing their Eldritch Horror. (Since there are 1300 people trading the the former, compared to 300 trading the latter, if we assume that the same percentage of people from each are trying to trade with us, that’s 4.33 people who think I’m lowballing them for each 1 who’s happy with the values. And that same logic applies to all games…if we value games more highly the fewer there are, and devalue them the more common they are…there will always be more people offering us devalued games then increased value games.)
In closing, I should mention that feedback is always welcome. We have to balance customer satisfaction with our valuations versus actually valuing in a way that prevents us from trading today’s hotness for yesterday’s games. It’s a delicate balance and we’re constantly modifying our formulas when and where we can. Ever since going live with our values in the past 2 months or so, there’s been a lot of positive feedback in the increased transparency, but also a few people very upset that it looks like I’m trying to get one over them. Your continued feedback helps me make sure that the latter occurs as infrequently as possible.