Half Price Books, Amazon and the Real Value of a Used Book
One month ago I was fed up. The amount of space in my house devoted to things I didn't use, wasn't interested in, and had no plans on using in the immediate future tweaked a serious nerve.
One of the worst offenders when it came to space waste was a lifetime's worth of paperback and hardback novels; books I had owned since my teen years, running the gamut from Bram Stoker's Dracula to Steve Perry's Shadows of the Empire to a pile of marginally useful O'Reilly tech books. ( Clearly I abuse the word gamut. )
With close to a hundred and fifty books that I had no plans on reading again, I had found an easy way to begin removing unnecessary clutter from my house. Armed with a copy of Delicious Monster, I scanned in all the barcodes of the books I owned, and created a spreadsheet that tracked their used prices (automatically fetched thanks to the excellent Delicious Monster).
Now I had a general guide as to how much my books would be worth if I sold them all used on Amazon; in this case, my books would be worth something in the range of $1800. Granted, there was a fair amount of variability in this price; the $1800 presumed that there was some definite demand for each book (doubtful), that the edition of the book that Delicious Monster looked up vs. the copy of the book I had was the same (not true in many cases), and that I had infinite time such that the likelihood each book would sell would eventually be 100%. So, my belief that these books were actually worth $1800 was a fantasy not so different from the embarrassingly large number of Dragonlance books I was about to sell.
Thankfully, I had another route open to me.
According to Amazon's website, Amazon Trade-In will let you send certain books, video games and movies directly to Amazon and receive immediate Amazon credit. No waiting for a sale, immediate gratification.
This definitely satisified my desire to get rid of many (not all) of my books, though I was disappointed to see that Amazon did not offer trade ins for every book I owned. I would guess that the trade in value is directly tied to the likelihood that Amazon can sell a book for some % greater than the lowest(?) used price available, and for some books either the supply is simply so great that demand cannot meet it, or demand is nonexistent.
However, in order for me to determine if it was worth my while to even go down this road, it seemed that the best course of action would be to find out the sum Amazon Trade-In value of all books I owned. One Ruby script later, I had calculated the Amazon Trade-In value of my collection: $504.75.
Put another way, Amazon stood to make ( at best ) $1295.25 off my book collection. They had the comparatively infinite time to make that profit enter into the realm of possible.
Miffed at the rather large profit margin Amazon stood to make off my books, I abandoned my project, and let myself be distracted by life for a few weeks.
Half Price Books
Flash forward to a few weeks later, and the lucky chance of my in-laws being in town to help watch our daugher while my wife and I did chores allowed me to return to my decluttering project. Desperate to simply get rid of the things I owned, I considered taking all the books to the library ( no luck, the library only accepted books during personally inconvenient time windows ), simply selling everything personally through Twitter ( required too much work without a guarantee that I'd free up the space anytime soon ), or Half Price Books.
Desperate to simply not have this problem anymore, I loaded up my car, and made my way to Half Price Books. An hour later, they made their offer: $67. Or, following the example above, 3.7% of their Amazon Used value, and 13% of their Amazon Trade-In value.
I was surprised, of course. Asking for an itemized list of how they valued the different books, I was told they had none. And here was where I learned some valuable lessons about Half Price Books.
The employees behind the counter informed me that there was no authoritative book value consulted when making an offer on a customer's books. I was told that the act of making an offer was "more art than science", and was informed by an employee's time spent on the floor reviewing book prices and observing sales patterns.
The rationale I was told for not consulting a demand driven pricing table was that the throughput of buy offers was simply too high - something on the order of 3,000 items were being purchased at the Half Price Books location I visited per day. The folks behind the counter seemed to think that any new additions to their process would harm their ability to process buy orders, and thus affect throughput.
This of course leads to the obvious next question: if there is no single authoritative price to value a book, how do you tell when you have overvalued it? To put it another way, how does Half Price Books know when it has paid too much for your books?
I was told that managers and associate managers review the book offers every day, and personally talk to employees who have "paid too much" for a given book. As before, I was not given an idea of what too much is, other than that it is "obvious" to an experienced employee.
So, let's state some facts about the Half Price Books purchasing policy:
- They don't value books based on a company wide view of how much a book is worth
- They don't have an authoritative source for the company's "demand" for a certain book
- Their employees are reviewed on an unstated metric for how effective they are at purchasing books
- Their employees derive pricing information from their experience on the sales floor, communication with other employees, and feedback re: the metric I mentioned above.
This leads me to believe that the following things are likely true about their purchasing policy:
- Value is weighted towards high demand books, by view of the employee who is reviewing your books. Unless the employee happens to be an unemployed graphics programmer, GPU Gems 3 will likely fetch something on the order of $2.00 because it is hardbound and has nice colors. Therefore, value can be highly variable depending on the employee.
- There is still an upper limit to that variability, because managers are evaluating performance. Therefore, there is likely a "rule of thumb" that is communicated to employees that says something to the effect of "100 books in decent condition == $50". The rule needs to be simple, in order to be taught quickly and measured simply; this rule generally trumps the above statement, because it is how an employee will be measured.
- Whatever the rule of thumb is in the above statement is, it has been derived over many purchases by determining what a customer will accept. The actual value has nothing to do with the value of your books, and everything to do with what people will accept at a rate that will allow Half Price Books to continue doing business (and make a profit, hopefully).
Unfortunately, these purchasing rules are fairly customer hostile ( if I am right :) ). You are quite likely selling your books by the pound, a metric in no way connected with their actual value on the market.
Furthermore, it seems to indicate that there is a fair amount of misplaced supply within the Half Price Books infrastructure. Since demand is probably not driving their book purchasing, inventory could be unevenly spread throughout different franchises and causing poor sales performance throughout.
There are even more interesting questions, like what does Half Price Books due with stale inventory, how often do they revisit pricing/performance rules for employees, and how are these policies viewed internally.
Where To Sell
After this experience, I'm more convinced that the best sales option for me to have taken would be selling to friends / acquaintances. This is the most likely case where you will either
- Receive a mutually fair price based on your relationship
- Feel happy about giving something away when the price doesn't matter to you
Should you not want to go that route, I'm more convinced now that you're likely to get a fair price by using the Amazon Trade-In program. Selling books to companies like Half Priced Books seems an unlikely route to receiving anything close to a book's actual value.
As for me....what can I say. Whether or not it was a bout of temporary stupidity, or a burning desire to be rid of things to own, I took the $67. I guess that's what I actually valued the books at.comments powered by Disqus