Thursday, October 30, 2014

Magic Discount Change

We learned from WOTC yesterday that we will see 2% increase in the price that the company charges us for Magic. The MSRP of $3.99 will remain the same however. What it  means is that stores selling Magic will earn about 4 cents a pack less. Usually, whenever a business has a price increase for its goods, it passes the price increase along to its customers. However, since WOTC has cut the discount rather than increasing the price per pack, which last changed from $3.69 to $3.99 back in 2006, stores, including us, will not be able to increase the price per pack. 

Magic pricing is so competitive, especially among online stores, that it would be almost impossible for any store to raise the price of Magic boosters above MSRP. This means that stores will have to absorb the drop in discount and the subsequent drop in gross margin, meaning lower profits and somewhat less money to invest in the business.You are likely to see marginal stores that focus heavily on selling discounted Magic eventually close as they will earn less profit to allow them to keep the store open.