Amazon’s $23,698,655.93 book about flies

I have been an on line book dealer for the past 10 years. Originally the rules about having actual possession of the goods offered for sale were quite strict.

Then came the megalisters - agencies with software that listed all books in print and a contract with publisher's warehouses/library supply services/factors to arrange delivery of in print books to customers.

Then came the "phantom listers" - agencies with software that spiders through the listings of legitimate on line book dealers looking for titles with few (or no) copies listed in Amazon. They then list them at inflated prices. Some of these have more than one alias on Amazon. I think of them as the Piranhas of the Amazon in the ay that they consume the smaller fish.

If and when they receive an order then then try to purchase a copy from one of the "real" owners of the book.[Some are cheeky enough to request as well a"trade discount" on the dealer's price] Small businesses listing on Amazon and abebooks.com must keep their "fulfillment"rating high, so they can ill afford to refuse to supply such parasites.In fact when I requested once that I NOT be obliged to support what I think of as an unethical selling and pricing model I was told

1] that the buyer was a valued long time customer and that 2] I could approach the agency in question and - at THEIR discretion - request that they stop ordering books from me.

Since AZ and ABE take out some % of the list price for the the books sold on their site (as well as monthly listing fees, closing fees and sometimes a portion of the shipping charge ) they can and do make a much greater profit from the high priced phantom listers than from the legitimate reasonably priced offerings of small book dealers, consequently they are not very interested in aggressively policing the situation.

Now there is "Monsoon" and other software to automatically adjust prices on line. In practice most often works to REDUCE the price below the lowest price already listed - a rush to the bottom where books get listed for mere cents.

One tactic I recommend is to search for books and to see the widest range of options is to use "addall.com" It comes in 2 flavours "New' and "Used"and searches around 30 book listing services You can compare prices (ascending or descending) and also see the kind of dealers who sell the books.

Many listings have boilerplate descriptions "we ship fast" "books may have..." etc. which indicate that no human may have examined the object being listed.Other listings have descriptions of content and condition that clearly demonstrate that it is a"real"book from a "real"dealer. When in doubt look for THAT dealers OWN website to ask questions and get personal service.

I don't think this strategy is unethical; it is really risky... probably so risky that it's naive for the long term.

It's not unethical because the buyer in this case can't really buy up all of the supply and therefore is just looking for arbitrage opportunities or opportunities to exploit weaknesses in a competitors business model.

The opportunities, over time, are very limited though:

1) You can't actually buy up all of the supply. If you were able to buy all of the listed supply and then reset the price you'd soon attract other sellers who had previously unlisted supply.

2) If there was real demand for an extremely high priced book I'd guess the author or publisher would be releasing a new version to meet the demand.

3) Although some printing of books are considered to be collectible, that market is limited. Generally the value of the book is the information it provides, which means that as the price rises the (perhaps less informative) substitutes become more appealing to buyers.

4) If you exploit a competitor's pricing algorithm enough to make them notice, they'll just change their algorithm. In this case, perhaps they don't sell you the books or they don't respond to your prices.

You might be able to make a few bucks on this strategy, maybe a few people could even eke out a living, but it would be risky... they'd earn it.

There is an upper-tier "club" on Amazon, you can see it alluded to indirectly in various SC help files. Maybe these guys get away with more than we do.

That is the most fascinating myth I continue to hear about the market. As a non-seat owner, you see three prices: The price of the last trade OVER 15 minutes ago, where a buyer and a seller agreed to buy. The highest price someone offered to buy the stock 15 minutes ago, and the lowest price someone offered to sell the stock 15 minutes ago. When you actually buy or sell a stock, you often do not buy from or sell to a long term owner. Instead, the transaction happens with a "market maker" an entity that is a seat owner, knows the current offers right now as opposed to 15 minutes ago, and trades with you. There is almost NEVER a "meeting of the minds" on price between a buyer and a seller. In fact, there does not have to BE a buyer if a market maker decides the value of the stock makes it worth acquiring or selling at your offer price. (If you check "Market" for your offer price, I suggest you read almost anyone who writes about trading, but plug your ears because they start shouting "no" really loudly). So, to finish (sorry about the length of this), a huge or in some cases a simply mis-priced offer to buy or sell may unnerve the market makers. They may hesitate. The lack of quick sales at a given price to the market makers causes repricing by the sellers, which causes the price of the stock to fall. Try pricing a limit bid between the buy and sell price on your electronic brokerage. You'll see. Sometime it will sell right away, and sometimes it won't. If you want to sell right away, you'll drop the price. And, if you happen to find a stock in "free fall", you'll never sell, because the price you see is 15 minutes old.

And not just his art, but his life as well: "they lived off his wife's teaching salary. During the 1970s, Gibson made a substantial part of his living from scouring Salvation Army thrift stores for underpriced artifacts he would then up-market to specialist dealers" [Wikipedia]