Why Reprice
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What I mean by (semi)automatically repricing is having a computer
reprice your inventory where you either accept the results without checking the details
(the automatic part) or only making a cursory inspection of the results and accepting the
great majority of the price suggestions made by the program (the semi-automatically
part).
Before we get started though, let me ask you a question: Do you sell
only moderately unique items? If the answer is yes then, IMO, there is no real answer
to why reprice. You probably shouldn’t, except rarely, and even then your expertise in
pricing is much better than what a computer program can do for you. This article is for
the rest of the people who sell (at least in part) new and (moderately) common books.
It also means that a part of your inventory should be excluded from repricing unless
you only sell new and common books (and even then there may be a few you want to exempt
from repricing).
So, why reprice? The obvious answer is “I can sell more books and make
more money”. The “and” part of that sentence is important because I know of no-one who
wants to sell books just to sell books. They want to make money at it or at least
break even. Even those who sell “just for the fun of it” would quickly quit having fun
if it cost them several dollars for each book they sold.
However, there is a little more to the “why” than just the simple answer
above. Although not necessary for the (less common) used book market, it is becoming much
more useful to automatically reprice you inventory in the new book market. Even when you
can’t automatically reprice your books, you can get some help by semi-automatically
repricing your books. The number of items in this latter category should not be too
large because you would then be devoting to much time to repricing instead of time needed
to run the rest of your business. Of course “too large” is relative and some businesses
even devote a (part of a) persons time to repricing (think of markdowns, sales,
“specials”, remainders, etc.).
One article on repricing is available in the IOBA Standard at
The Alibris Pricing Tool and is by Richard Weatherford. The article makes the
following observations:” It won't help with your antiquarian or highly specialized books -
your expertise will be more accurate than our market data.” and “We know who buys books
online - and it is overwhelmingly readers, not collectors. We know which copy they pick -
usually the lowest priced one that is not torn, broken, or marked up.”
Another reference is a basic pricing presentation
Retail Pricing and Repricing of Merchandise
which gives several reasons for repricing. Some reasons given are pricing errors, selling
errors, and, of course, the demand for the item. It also discusses other aspects of
repricing which we will come to later.
Through the above articles, and many others, we come to the major reason
why we should reprice our unsold new and common used books – supply and demand. Although
we have focused mostly on markdowns, let’s not forget that repricing can also mean markups.
When the demand is high and the supply seems inadequate, we might want to price our books
over retail. When the demand is high but the supply seems adequate, we can price our books
near the same price as Amazon. When the demand starts to become lower and supply starts to
exceed demand, we want to lower our price and get rid of what we have. Or put another
way, we want to reprice to maximize profit and minimize loss. After all, isn’t it better
to make just a small profit or accept just a small loss by selling the books than let the
books set around until they are basically unsellable. With the latter, you can get part
of your money back by scrapping the books but even in the best case I doubt you could get
back more than a few tens of cents on the dollar which is probably less than if you had
sold them at a few pennies loss.
Repricing – the Basics
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If we have decided that repricing may work for us, we need to implement
the repricing and that is our next subject. Before we continue, we emphasize that the
purpose of repricing is to maximize our profit and minimize our losses. We do not want
to mark down (or up) any item unless we feel we need to and, in any case, we do not want
to become a “penny seller” (nor a "scalper"). In the case of markdowns, we would
probably do better with our merchandise by selling the remaining lot on
eCrater
at a steep discount before we got to the point of penny selling or, in the case of
individual items either make lots for eCrater or donate them to the local library,
nursing home, childrens center, etc. and get back our few tens of cents on the dollar.
For our purposes we want the markdowns to be sharp enough to move
goods, that is make the customer choose our book rather than a competitors or conversely,
the markdown should not be so small as to be ineffective.
Repricing scripts should try to mimic the supply & demand market place
because that is what is really driving the market - at least that is the theory most
widely accepted. To do so they have to have a handle on both for your specific
inventory.
Specific Considerations
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Before we get to specific considerations, one point needs to be made.
The most widely available database of books for price comparison is the Amazon database.
It is also the service you see mentioned most often on the net when looking at repricing
software for media like books and/or DVDs, etc. Although it does not make a difference
in many cases, we will assume that we will be using the Amazon data. Thus we will have
available (an approximation to) the “demand for the book”, the Amazon ranking (yes, I
know that a snapshot of the ranking just indicates the last time the item sold and not
its popularity but we will be assuming that the ranking used is an average over time
which does indicate popularity).
A: General Exclusions
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What items are you going to exclude from repricing? Different rules
may apply depending on the type of item. For example, don't reprice Records which have
been listed less that 2 weeks and don't reprice Books which have been relisted less than
a week.
(1a) What is the minimum price you would like to have automatically
repriced (value in your inventory currency, typically USD for AoB)? Any price below this
will not be repriced, so if you answer 0, all items will be repriced subject to other
rules, i.e. see the minimum number of days (3a).
(2a) What is the maximum price you would like to have automatically
repriced (value in your inventory currency, typically USD for AoB)? Any price above this
will not be repriced, so if you answer 1000000 (larger than your most expensive item),
all items will be repriced subject to other rules, i.e. see the minimum number of days
(3a).
(3a) What is the minimum number of days the item should be listed
before you automatically reprice it? If you have faith in your initial pricing, you
might want to wait a bit before you start to automatically reprice the item. If you want
to reprice regardless of the number of days listed, use a zero.
4a) What is the maximum number of days listed you quit repricing the
item. Never would be 1000000 [actuallly this is only about 2738 years but it should
suffice for most purposes].
(5a) What is the minimum Amazon sales rank you would like to reprice
(everything with a rank below this will not be repriced)? Some people like to just set a
price for fast selling items and forget it because it will sell fairly quickly anyway.
Others like to reprice everything subject to the other rules. In this latter case you
would use a zero.
(6a) What is the maximum Amazon sales rank you would like to reprice
(everything with a rank above this will not be repriced)? Some people like to just set
a price for slow selling items and forget it because the item is "worth waiting for the
right buyer". Other like to reprice everything subject to other rules. In that latter
case you could use 100000000.
(7a) Do you want to exclude any general category from repricing, i.e.
Collectible, Used, New, Acceptable, ...? If so, which ones.
(8a)Do you want to exclude certain patterns which occur in your
keywords, notes, or private keys or ...? If so, what are the patterns and where do they
occur? For example, there may be certain items you would like to always manually
reprice. If you entered MRO in private field p0 to indicate this, then your answer would
be yes, MRO in private field p0. Note that you are not limited to just a single choice.
You could use any or all of your private fields and your keywords and your notes.
B: Determining Comps
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Who/what are you going to price 'against'. You may want the different
rules for differnt type items. For example, Records require a minimum feedback of 4.3
and Books require a 4.6. You may not want to consider certain dealers. Note: The more
restrictions, possibly the fewer comps you will have.
(1b)What is the minimum feedback rating for a dealer to be considered.
The ratings, when given are on a five point scale, so typical answers range from 4.2 to
4.8. IMO, both of these extremes are too low/high.
Note: Amazon has been returning nothing for Feedback ratings.
AOB has been setting the feedback rating to zero. So,
if the rating is zero or is greater than the following
minimum, the dealer's prices will be considered (assuming
other restrictions, possibly such as Condition are met).
Do you want to "grade" the dealer on their feed back? That is, if you were comparing
prices to a dealer with a feedback of 4.2 and you typically had a 5.0 feedback, you might
consider asking 10% more for your item. You want to be careful with this if you are
using other tables to convert prices.
(2b)What is the minimum number of feedbacks needed to use a dealers
prices? For example, you might not want to include sellers who are "fairly new", i.e.
don't have at least 50 feedbacks. Feed backs tend to run somewhere between about 10 and
30 percent on Amazon so, using the average of 20%, a feed back of 10 would translate to
sales of about 50 items; a feedback of 50 would translate to about 250 items. Again,
this value may not be available for all dealers on AoB so, if the value is zero, the
item will be repriced anyway (subject to other rules). Do you want to "grade" the
dealer on their number of feedbacka? That is, if you were comparing prices to a dealer
with 10 feedbacks and you had several thousand, you might consider asking 10% more for
your item. You want to be careful with this if you are using other tables to convert
prices.
(3b) Who are the excluded dealers. Certainly you would want to exclude
yourself but there may be others you would also like to exclude.
(4b) What is your minimum outlier price?. That is, what is the minimum
price to be considered in the computation of a new price? This does not have to be your
minimum price for the item. If the dealers price is less than this, his price will not
be considered. As an example, you feel that your price should not be compared to items
more than 50% down from your price, i.e. if you have an item priced at $10, you don't
want to compare it to items less than $5. Then chose a factor of 0.5.
(5b) What is you maximum outlier price?. That is, what is the maximum
price to be considered in the computation of a new price? This does not have to be your
maximum price for the item. If the dealers price is more than this, his price will not
be considered. As an example, you feel that your price should not be compared to items
more than three times your price, i.e. if you have an item priced at $10, you don't want
to compare it to items higher than $30. Then chose a factor of 3.0 [300%].
(6b)Do you want to compare those in my condition class only (Used,
Collectible, New) or some other combination, i.e. you might want New and Collectible to
include each other for comparisons but Used would only include Used comparisons.
(7b) Do you want to compare items in your condition, your condition or
better, all items, or some other combination? Also see (6b).
(8b)Do you want to consider converting items not in your condition to
your condition by making a conversion table? As an example suppose you had the
following: Like New was worth 87.5% of a New item, Very Good was worth 75% of a New
Item, Good 50% and Acceptable 25%. That would give rise to the following table:
| New | = 1.000 |
| Like New | = 0.875 |
| Very Good | = 0.750 |
| Good | = 0.500 |
| Acceptable | = 0.250 |
To convert an item to New condition, you divide by the number. That is New is 4 times
the price as an Acceptable (divide by 0.250), 2 times the price of a Good item, one and a
third times a Very Good item, and 1 and a seventh times a Like New item. An example of
the way this table would be used is the following: Suppose you had an item in Very Good
condition, so you want comparisons to Very Good items. Also suppose you only had an item
in Good condition at $10 to compare to. First convert the Good to a New Item, i.e. twice
the Good item or $20. Now convert to a Very Good item, i.e. 75% of $20 or $15. If you
would like to use this kind of capability, provide factors for the above table. Also,
if you could have different tables for different types of items, say a table for books,
one for records, and on for video games.
Do you only want to use the table on particular classes or conditions or ranks or ...
(9b)Are there some dealers you would like to "add a bit" to their
prices? For example, a dealer charges a $4.99 Standard S&H on Amazon (obviously a Seller
Central dealer) and Standard S&H is $3.99 for you. You might want to add $1 to this
dealers prices for a "fair comparison".
C: Limitations on Price Changes
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Limitations on price changes may depend on type of item and/or price and/or ...
(1c) What are your minimum prices, if any, for
New Hardcover:
New Paperback (includes Mass Market Paperback & Softcover):
Used Hardcover:
Used Paperback (includes Mass Market Paperback & Softcover):
Oversized/Heavy (and how and where is it designated):
DVD/CD:
Record:
...
(2c) What is the maximum price drop you want? A value in dollars (or
the currency your inventory is priced in).
(3c) What is the maximum price raise you want? A value in dollars (or
the currency your inventory is priced in).
(4c) What is the maximum price drop percentage you want? A value of
30% would be 0.3 or 30%.
(5c) What is the maximum price rise percentage you want? A value of
30% would be 0.3 or 30%. Thirty percent would mean, for example, that a $10 book would
not be raised higher than $13.
(6c) What happens if the minimum/maximum price drop/raise is reached?
One usually just reprices the item at that price. However, you might not want to reprice
the item if the price raise were raised to $50 on a $5 book (1000% percentage raise).
You might want to actually look at the prices yourself. Note: If you have different
answers for (2c) through (6c), please match up the answers with the list number.
D: General Considerations
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(1d)Other things to consider when you are thinking of repricing rules
is whether you want different rules depending on the length of time listed and/or the
Amazon ranking of the item, whether you want to reprice if there are only a few (less
the 3? 2? ...) items listed, whether the number of copies you have should affect your
pricing, whether certain items should not have their price lowered (raised), whether
you want to lower (raise) an items price twice in a row, ... Note that different rules
can be programed for different situations. For example you may want repricing rules
based on the Amazon rank and the amount of time listed. Lists B and C above can be
modified for individual rules if wanted.
(2d) Repricing rules can be simple (put my price midway between the
first and second lowest price) or complicated (if the item has been listed more than 10
days and less than 60 days, compare my price to any conditions within two of mine using
the special conversion table of 1, .93, .85, .70, .3. Use the harmonic average of those
in my condition if there are at least three comps. If not, take the harmonic average of
each condition and use the lowest. Special outlier values are 0.1 and 50. Special min
and max price changes of 60%/$5 down, 100%/$100 up. Compare to anyone but myself. ...)
(3d) When thinking of how you want to reprice, i.e. making rules,
remember that you also have to know what to do if there are no comps. Most of the time
this is just a 'don't reprice'. But you might do like the 'complicated rule' in (2d).
That is, if there are none (or not enough) in my condition do something else, etc.
(4d) What is the order of the "rules", i.e. what is most important?
For example suppose you want a minimum price of $5 and to be 10% under Amazon. If you
check for the minimum price and then check for under Amazon, it is possible to price
your item at less than $5 [think of Amazon selling something at $4.99]. If you first
check Amazon price and then check the minimum, you may price above the Amazon price.
(5d) Generally history of prices, rankings, quantity available, etc.
are not available on AoB. One simple exception comes to mind immediately and that is
the length of time the item has been listed but that's about it. However, you can track
a few simple things via your price. For example, if it ends in an 9, the price was not
changed the last time it was repriced or was an initial listing or is at the minimum
price; if it ends in a 8, the price was reduced last time it was repriced; if it ends
in a 7 the price was raised the last time it was repriced. You can also add other
"codes".
(6d) On AoB, after repricing, i.e. after running SOLOIST, if you go
to Manual Repricing Page [Inventory->Reprice Your Books] you can typically see the items
which were not repriced. However, there is a flag which can be set in the repricing
script which will cause the items(s) to not be displayed on the page(s). If you have
some items which you do not want to show up there in any case, you could, for example,
enter NMRP in the p0 field and have the script set that flag. You might also want to
use the flag if the book were not repriced because it was already at the minimum. Are
there any cases where you would like to use this flag?
(7d) Considerations of rank and sales time indicate that fast selling(low Amazon rank)
limited quantity items, i.e. used books, should not be priced at the low end of the
spectrum but rather in the mid to high end. The reasoning is that those costing less
will sell quickly and then yours will sell. Limited experience (not mine) and further
consideration indicates this is not true for (near) unlimited quantity items, i.e. new
books. If you are in the middle of the pack on price then those below you won't sell
out and you will 'never' sell your item. The placement for these 'new' items may be
mitigated by description (a better description means you can price higher, a poor
description means you should price lower), feedback (if available a higher feedback,
relative to your competition, means you can price higher, a lower feedback means you
should price lower).
(8d) Other things to consider
- What if you am the only seller? Would you want a maximum price if that is true
and where do you get that price?
- Should you reprice if you don't really gain anything by it. For example, sellers
3 and 5 have prices of $3 and $5. You are seller 4 and have a price of $4. You
use an average repricing rule which would reprice your item at $3.51. Would you
want to reprice? How about if it had been $4.50?
- Do you only want to consider certain sellers?
Repricing Programs/Services
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Alibris You have to be a seller on Alibris and belong to their
Gold program. Although several years old, the article in the IOBA Standard by Dick
Weatherford still has some good discussion on (re)pricing, see
The Alibris Pricing Tool
AmanPro Listing, (Re)Pricing and Order Management system for Marketplace
sellers.
APPEAGLE Supported marketplaces and listings Appeagle is available for listings on
the eBay.com, Amazon.com and Buy.com marketplace sites. Support for international sites will
be coming shortly. Appeagle supports all marketplace listing types, including auctions,
variations, fixed price and fulfillment by amazon (FBA).
Book Repricer will save any Amazon Pro Seller hours making
sure your books/CDs/DVDs etc, are priced correctly.
BookTrakker's Grabit Used for comparing current prices to
the competition and resetting your price.
Fillz: A web based system offering Standard, Premium or Customized accounts.
RepriceIt: You're in control with 25 configurable repricing
parameters, with unique features such as, Positive Repricing, and the ability to exclude
competing sellers with poor Feedback ratings, and many more options.
SellerEngine: If you are an Amazon ProMerchant selling books and media,
SellerEngine Plus offers the tools and the speed you need to price competitively and
keep all your listings up to date.
SellerEngine: If you are an Amazon ProMerchant selling books and media,
SellerEngine Plus offers the tools and the speed you need to price competitively and
keep all your listings up to date.
Teikametrics: The proprietary repricer tool allows you to pinpoint and price
any Amazon listing inclusive of shipping costs. Customized rules enable you to choose
how you compete for sales.
Simple Repricing Script Snippets
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The following repricing script snippets are provided on an "as is"
basis. Versions of these scripts are available at some of the repricing services
mentioned above.
Repricing scripts should not, in general, directly change your database.
Don't reprice on flag
if($flag =~ /(NORPRC)/i ){
$vout->(comment) = "NORPRC flag
set. Not repriced/n";
$vout->(modify) = "n";
Don't Reprice for greater than Min or less than Max price
if($my_price < $min_reprice || $my_price >
$max_reprice){
$vout->(comment) = "Less
than minimum or greater than maximumn";
$vout->(comment) .=
"repricing price. Not repriced/n";
$vout->(modify) = "n";
}
Don't raise price if flag is set
if($flag && $new_price > $my_price) {
$vout->(comment) = "Flag -
don't raise price - set. Not repriced/n";
$vout->(modify) = "n";
}
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