Over the last 2 years, many players have begun to do what only larger dealers had once been able to; they are now applying "big business" practices to the management of their personal wealth and collection.  This has led to a subtle shift in the dynamics between the dealers - which I will define as an organization that exists for the sole purpose of profiting from the sale of individual Magic cards - and the players.  There is now a third group of people, and one that is growing quickly.  The "player-dealer".  This term was introduced to me in an essay written by Dan Bock.  To me, a PD is an individual who is conscientious about his collection's net worth, equity, and profitability without maintaining any sort of a business infrastructure, such as an online or retail store.

The rise of the PD has caused some havoc with many true dealers.  Sites like Quiet Speculation have been empowering players to challenge the status quo of transacting trading cards, and the infrastructure of the card selling business has yet to adapt.  In the age of the internet, geography, time and currency are all rather irrelevant terms.  We have services that can easily render those factors irrelevant, or at the very least, trivial.  By divesting ourselves from our location and the restrictions that follow, we can use big words like "geoarbitrage" to feel smart and make money.

Before continuing down the ever-deepening rabbit hole of the cancelled order, here are some examples of how the internet has changed the way Magic cards are transacted.

Most store owners keep 9-5 M-F hours, because it's what they know. Rare is the retail game store that closes at 5pm and needs to open at 9am.  It can be assumed that these store owners are just creatures of habit, and there's nothing terribly wrong with that.  Let's make up a fictional game store, ASD Games.  ASD Games has a retail store in Cornfield, Indiana, where they get a good turnout for FNMs and drafts.  The majority of ASD's business comes from their eCommerce site, which operates similarly to a site like Star City Games; they stock a lot of cards, transact a lot of cards, have a buy list, etc.

We understand that cards are a variable price asset, correct?  This should not be new ground for anyone who has read anything about Magic in the last 6 years.  The card values change in a rather predictable way, and at predictable times.  If you don't realize this, you're not paying enough attention.  Most cards will hit a peak price on the Monday after a big event in which the card "breaks out".  This is just like a company issuing a quarterly earnings report on Wall St.  Let's say that ASD's inventory manager, who sets card prices, doesn't work on Sunday nights.  He's busy watching the Colts beat the ever-loving crap out of whatever second-rate team they're playing this week.  He's 5 beers in, and he probably doesn't want to be bothered whipping out his laptop, signing into the eCommerce back-end, and "going to work".  Again, who can blame him?  The card gets bought out at the old price, and the business either loses money (because they didn't sell for more) or they risk irate customers when they have to send a flurry of "sorry" emails the next day.  Wouldn't it have just been easier for the business owner to hire a college kid who plays Magic to keep up on the latest developments in tournament coverage, report them, and implement the changes?  Instead, he has to waste time addressing bad PR on forums, blogs, handling irate customer calls and emails and whatever other abuse gets sent his way for this issue.  Seems inefficient.

You can try to change the market to fit your business, but you'll work a lot less and make a lot more if you change your business to fit the market.  In a free market, the MTG secondary market, any business model predicated on customers not acting reasonably and in their own perceived best interests will be laden with friction and trouble.  Your system must account for this fact.  No customer will act in your best interest, so assume that you must prevent them from doing something you don't want them to do.  You can do this by building your system to assume "the worst", or you can fix it after the fact, which takes more time, on a sporadic basis, and can clearly damage your reputation, warranted or not. Remember, just because you don't think that you did anything wrong, if your customer does, then you will still get bad publicity.  There are ways for customers to manage the risk of cancelling an order, which could be argued as being in the best interests of the reseller, but those will be covered shortly.

The replies that have come from some stores that have canceled orders have been astounding.  At least one eBay seller has cited his need to "feed his wife and kids" when a customer had been complaining for months about cards that did not arrive.  The kicker?  The cards were insured.  Others have been heard using excuses about wanting to serve more players, out-of-date pricing, moving offices, and every other excuse in the book.  Let's make something abundantly clear here.

YOU ARE IN BUSINESS.

In case that wasn't clear, you are in the business of transacting Magic cards.  The goal of any transaction is to buy something for less than you sell it, or to sell it for more than you buy it.  That's it.  There are 3 ways to make more money.  Buy it for less, sell it for more, or sell more of it.  Those are the variables.   As a player, a pure player, your only concern is getting the cards you need for the event you need to win.  Most players are also collectors, speculators, etc.  There's something to remember here.

THIS IS A TRADING CARD GAME.

No one cares if you don't know the prices.  This is cutthroat.  This is blood sport.  All those nice terms like community, gaming, organized play?  Just ways of putting a friendly facade on the bloody art of the deal.  Like it or not, Magic: The Gathering has a full, robust secondary market, and if you're not taking full advantage of this, then someone else will, and they'll do it at your expense.  This is Sparta.

Information is valuable.  Information is more valuable than cardboard and money combined.  When you have tech, you sequester yourself in beach houses and urban apartments.  When you have tech, you brew it in basements at midnight.  When you have tech, you question everyone's loyalty.  Information is just a more broad form of tech.  Rather than use the word Speculator here, we can  just assume that every Magic player is interested in spending less money on his hobby or profession.  Thus, everyone is a speculator! That's why its particularly egregious  when shops claim they "don't cater to speculators".

Information means that you know more, about more, sooner than everyone else.  When you do the research on a format, brew a deck, grind matchups, and win a tournament, no one calls you dirty.  When you buy out a bunch of "dealers", who usually have at most 2 playsets of a card in stock, you get labeled a "speculator" and blacklisted.

When Did MTG Stop Being a CCG?

When did Speculator become a four-letter word?  Magic has two facets - the collectible facet and the card game facet.  Let's define our terms, courtesy of Dictionary.com

Game - n - a competitive activity involving skill, chance, or endurance on the part of two or more persons who play according to a set of rules, usually for their own amusement or for that of spectators.

Investment - n - the investing of money or capital in order to gain profitable returns, as interest, income, or appreciation in value.

There's a common theme here.  Personal gain.  The very definition of a collectible includes the strong possibility that the object in question will increase in value, and is categorically defined as something that has a variable price.  A game, in this case, is about winning.  Competition is about winning.  There are other benefits, but the object of a game is to win.   Anyone at the highest level of any competition will agree.  An investment is simply the application of a resource to gain more of that resource as a function of time.  That one's easy to understand.  Where does it leave us?

All's Fair in Love and War

Considering the definitions above, we should probably define our terms of engagement.   What's fair game?  What isn't?  Well, rather than sit here and hammer out the Geneva Convention of Magic Cards, let's apply some common business sense.

Rule 1: If you publish a price, honor the price.  This is non-negotiable.  If you cannot take the time to proofread your business' website and allow a decimal place in the wrong spot, you are a sloppy businessperson.  If you can't keep up on your current prices*, you deserve to lose the money because you didn't do the work to keep it. Mistakes cost money in the real world.  While you will not be lambasted for not honoring a $25 Mox Ruby, it shouldn't happen in the first place.

Rule 2: Honor quantities. If you don't want people to order more than X of a card at once, ensure your POS system will not allow this.  The following reasons are irrelevant and demonstrate that you are either cheap, ignorant or both:  My eCommerce system doesn't allow that.  We want to keep stock for local customers.  We didn't actually have that many in stock (this one is usually just a bold-faced lie).

Rule 3: The customer's order doesn't need to make sense.  Your job is to conduct the transaction in the most efficient way possible, not to ask my why someone just ordered 50 copies of Mortician Beetle.  Don't ask, because they're not going to tell.  If you don't want their money, then don't make 50 of them available on your site.  See Rule 2.

Rule 4: You are disposable.  You are a middle-man that conducts a relatively simple "pawn shop" model, which has been around as long as currency has existed.  Nothing you do is new, exceptional, revolutionary, or even "good".  You are simply a machine to make profit and mark up cards, and as long as you can do this while keeping satesfied the people who feed the machine, you may continue doing this.  At such a point where you cease to be the most efficient option, you are a dinosaur and should be thrown into a Rocky Tar Pit.  This is business, and if someone can get more stuff, cheaper, and more reliably, elsewhere, they will.  Don't become angry at your customers for making the reasonable choice.  If you don't want a customer's money, there are a hundred other sellers that do.

Many people will read this and consider it unnecessarily harsh, but if you compare a store who abides by these rules to a store that does not, you will quickly see why they matter.  The bottom line is that your commercial framework should ensure that no customer can take an action you are not willing to honor. Ever.  Non-negotiable.

From a Player's Side

Here's what happens when a player tries to buy a large quantity of cards and gets the order stuffed.  Let's call him Jim, and he'll be ordering from ASD Games today!  Both parties are fictional and any resemblance is purely coincidental.

Saturday, Day 2 of Pro Tour - Jim spends his afternoon reading coverage and identifies a few key cards that make up the bulk of new strategies represented.  He realizes that these cards could represent the backbone of an entire new archetype and thus, orders 12 copies of each.  ASD Games is closed on Saturday and Sunday, since it runs on typical North American business hours.

Sunday, Day 3 of Pro Tour - Jim, confident that he now has 12 copies of each card he needs, finds another store that has the same cards for about 10% less.  He decides not to order any, despite the lower price, because he already has plenty.  He'll keep 4 of each for himself, sell 4 when they rise in price to cover the cost of his playset, and sell 4 more to compensate himself for the time he took ordering and researching the purchase.

Monday, 1st American Business Day post-PT - The coverage has been widely read, and ASD Games realizes that the cards that Jim ordered are all very popular and have sold out completely.  They also notice that the largest dealers have doubled their asking and buy prices for the cards in question.  They see Jim's order for 12 of each card, and contact him informing him they will only be sending him 4 of each.   Jim asks them to honor their advertised price and quantity, as they have had his money for two days and he could have just ordered elsewhere had he known in a timely manner.  ASD informs Jim that he can buy the other 8 at the new price.

Here's what happened:

Jim's money was devalued. He spent the money on Saturday, and was informed on Monday that his order would not be honored.  In this time, the asset he was attempting to purchase had appreciated in value in accord with his prediction.  This is equivalent to calling someone's raise in Poker, only to have them rescind their bet.  As a store, you are making an offering to a free market.  eCommerce is a 24/7/365 tool, and while this allows you to keep your store open all the time, you must mind it 24/7/365 as well.   Just because you're not working on Sunday night doesn't mean Jim isn't.

Jim's time was wasted. Jim spent a few hours reading coverage and watching tape to find some shooting stars.   Jim is clearly not another dealer.  Jim is simply trying to turn his hobby from a money sink into a profitable enterprise by exercising financially savvy discussion.  We call this speculation, but since that word has apparently become a term of derision, let's just all agree that Jim is doing what any reasonable player would do, had they the knowledge and resources.  By reversing his order, Jim now loses the ability to gain value from his research.  The order was time-sensitive, and now his money is devalued in addition to having the time spent researching being wasted.

ASD's reputation is damaged. Jim, having had his time wasted and money devalued, is not happy at this point.  Jim will tell everyone he knows about his bad experience.  The effects of social networking and the internet, the same factors that allow online stores to rise to prominence when they're good, will magnify his displeasure as it is retweeted, facebook'ed, and blogged-about.  The fallout will greatly exceed the magnitude of the wrong; the total loss Jim experienced was probably no more than $100.  If someone influential in the MTG community parrots his story, it's magnified even more.

ASD's profitability takes a hit. Despite the fact that they'd have lost no more than $100 by just honoring Jim's order, they'll lose far more business than that by the ripple effect of Jim's bad publicity.  Thus, had they considered that $100 loss as "marketing budget" against the potential PR nightmare, they'd have seen that they could have saved money.  Remember, all of this would have been prevented if they just kept their prices and inventory under tight control.

"Our System Won't..."  and "We're Closed That Day" and "We Shouldn't Have To..."

Other sorts of excuses include "Our system won't do that"  or "But we don't work on Sundays"  or  "We shouldn't have to spend money to appease customers so they won't talk shit about us on the Internet".  We've all heard these, and it's shocking that anyone accepts them.  If your system "doesn't do that", then find one that does.  If you're not adjusting prices each weekend, when all the events happen, or at the very least, on the weekend of a Pro Tour, you should be.  If you don't like having to fight with angry customers giving you a bad reputation, keep your customers happy.  It's called accountability.  You are in business, so act like it.

The bottom line is, if you keep your prices accurate and only sold in quantities that you care to honor, there will never be a problem. The issue with cancelled orders lie in the example with Jim and ASD Games.    Had ASD kept up with pricing, Jim would have simply ordered from the other store (and then it would be their problem).  Had ASD limited quantities or built in an automated price adjuster based on quantity, Jim would have at least known how many he'd be getting before he paid his hard-earned money.  Rather than debating the merits and demerits of canceling orders, every reseller should strive to never need to cancel an order again.  There will be time spent, costs incurred, and effort exerted to meet this standard, but if you as a seller are not willing or able to expend those resources in order to tighten up your ship, then you are obsolete and, as rule 4 outlines, your customers should,  and will, go elsewhere.