It does depend on an item’s rank and time of year and sometimes ability to replenish an item. For example, clearance candy after Christmas which you can’t get more of. It has great rank and initially really good profit. Everyone starts racing to bottom. Not me. I have it priced where it was initially and I wait until people run out. I am just now starting to sell some of it at a great profit, much better profit than I would have before When I probably would either lost money or broke even. We don’t use a rePricer and I price things where I think they should sell if people didn’t all freak out with their repricers. It may take me a weeks to a month longer to sell something but I am in this business to make a profit and not to break even or lose money. We end up with a really high roi this way and I expect us to sell all of our clearance Christmas stuff sometime this month so it is not like we are waiting six months to do this. However, if it is an item that is easily replenishable I tend to price for the buy box at a certain minimum ROI. Those items may never increase in price if certain sellers keep coming back and I usually just want to get out of those things.
Racing for the “Buy Box” is a lie. In reality, you’re racing for “Zero Profit” because you and the next guy will keep battling each other until there’s no profit. My strategy is match the buy box price and see what the other seller does. If they are okay with sharing sales, then we’ll both share sales and maintain our profit margin. If they want to race, I set my price to be within 2% higher to the racer’s price and get sales when it’s my turn in the rotation. It doesn’t really become a problem with 1 racer. When it becomes difficult is when there are 2 or more. Then I don’t even try to stay at 2%. I just set my price and forget it.
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