Silk Road forums
Discussion => Off topic => Topic started by: tofuu on July 09, 2011, 03:01 am
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I cannot help to notice that the prices here seem to be higher then I would pay for the the same items I CAN FIND LOCALLY. I've always wanted to try Adderall, but no one I knew was selling it so I didn't have the chance. When I saw it here, I'm sure I overpaid because i wanted to try it. So....
How do you see SR both long term and short term? I think the prices will be higher for the simple reasons I had also had, but as more or larger suppliers come online and start to compete will the price come down? Will SR always be a sellers market, or will economics and long term existence start to bring prices down to local comparable levels for products available? It doesn't seem like there are a lot of suppliers now online with unlimited inventory, which is good for availability, but maybe not as good for prices...
Any thoughts?
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Generally the prices are going to be higher on SR, especially with the current escrow system in place. This is due to major bitcoin volatility, potential scam buyres, added costs to ship and secure packaging, and the time premium for waiting for your float to be released while it is sitting in escrow (potentially for a few weeks).
That being said if you find a good supplier with good methods you will have consistency and convenience on your side. And maybe a better quality product.
I would think that if more large sellers are joining prices will come down as major coop operations use their purchasing power to drive down prices and push out competition. I wouldn't really call it a seller's market just yet because all of the financial risks are on the seller side and the artificial state-imposed consequences for claiming the right to your own body are yours.
Give it some time. This is still very new. Over 20k members now though and transaction volumes have been climing steadily. Might attract some big fish.....
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Shipping charges.
Packaging charges. Some vendors pack their wares very uniquely which adds to the price.
5% of the sale funds the running of the site.
Also to mention there is a lot of vendors on here at the moment who in real life would be considered end-users instead of sellers and they are trying to make some coin while the prices are high.
Then again talk to the Australians on this board and they will tell you that with a few exceptions, most of the stuff is damn cheap.
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I think like any market that is "free", it will be driven by supply and demand. When markets are free'd, typically prices come down and quality rises. I have noticed that some prices are high, some are low, and some are right. I personally think that SR is safer than dealing in the black market locally, so slightly higher prices are worth it. Restricting seller accounts may cause a sellers market.
Increase regulation, increase price, decrease quality.
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I think like any market that is "free", it will be driven by supply and demand. When markets are free'd, typically prices come down and quality rises. I have noticed that some prices are high, some are low, and some are right. I personally think that SR is safer than dealing in the black market locally, so slightly higher prices are worth it. Restricting seller accounts may cause a sellers market.
Increase regulation, increase price, decrease quality.
Yeah, there's always something about the "guy with the bag" that want's to turn them into slave owners.
I believe in the market. If enough show competition will do it's thing.
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I wonder if prices are really that high. Silk Road ups the price by 5% for escrow and shipping costs between $5-10 (labor, materials plus the actual shipping) It is super safe and easy. GreenCo charges $50-$60 for 1/8Oz (3.5g) which is about average for the country. Yes, lots of places it is cheaper (San Francisco $40) but many places it is more expensive (Houston $65+ and it's not nearly as good). I think $55 +/- $5 is pretty awesome, and it comes with escrow, safety, a satisfaction guarantee.
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Another perspective. Lets say a vendor sells F2F. The going rate in his area for product X is 40.00. To make it worthwhile for a vendor to sell here, he needs to make more than what he would F2F. For example, Silk road gets 5 percent which is 2.00 then priority shipping is between 5-6 with DC. Then add another 2 bucks for mailing material and decent printed labels. That adds almost 10 bucks to that order. Then the time. To do it right. you have to wear gloves, etc. and then travel to the post office add a couple of bucks for that. So, right there brings the cost to about 52 bucks. Now, lets add the cost to get the BTC's into cash, lets add about 5 percent for the mt gox fees and other fees. thats another 2 bucks.
So, now we are at 54.00 dollars for the 40.00 item. Then there is the BTC fluctuation. Since its hedged right now, it shouldn't take too long to do all of this. so lets add just a buck for that.
So, now, for me to put 40 bucks into my pocket, I have to charge at least 55.00 just to make what I would normally make. So for the pain in the butt fee lets add 5 bucks. etc lets say the product goes for 60.00 and thats being conservative. So, basically thats roughly a 33 percent mark up that needs to be done in order for it to be worth selling on SR.
Now, it depends on the product, etc. If I have an endless supply and it only costs me 10 bucks, then I would need to sale on SR because it means a lot more profit. But, if youre limited on the items its very important that the vendor gets what he is asking for on sr because it wouldn't be that difficult to unload to friends, etc.
The above is hypothetical and everyone is different. I just want to point out that a vendor needs to add a substantial amount to cost to make it worth it .It also depends depend on the product, etc.
I just wanted to put things into perspective a little bit more for buyers. So, if you see that it costs between 30 percent and 40 percent more than what you can get it for, the above is probably the reason.
i know I may have not made sense, but I'm tired.
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I agree with you, CP. ^^^ Vendors here provide quite a service, and I find the prices more than fair. I"m not expecting 'bargains' on here. Not on here because I expect it to be cheaper than the street. I once asked a dealer to deliver something to me, an out of the ordinary situation, and I gladly paid *double* just to get him to do it. Anybody who thinks it's expensive here, can just trot on down to the hood and take their chances. Supply and demand works. We pay xtra if there's only one of a product...if there are bunches of competing products, well, I can go for 'cheaper' or I can take into account which seller is quicker, which packages less 'noticably' , and finally, which seller uses PGP: that's a *big* one to me. I"d hate to save five bucks, and then find LE was reading addresses that weren't encrypted...lots of factors...
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OK - I absolutely understand the smaller sellers direct costs are more and therefore need to charge more, but it's the law of supply and demand I'm talking about. Do you think the sellers with better product, more efficient methods of packing and shipping and overall lower costs will come in at some point and move out the little guys who don't have the ability to keep the costs below what they have to sell. It's the business model of Walmart and they will drive every mom and pop operator there is out of a small town in a short time. Is that the future of SR and if so what will it look like in 6 months or a year?
I'm willing to pay more now and I happily do, but I was just wondering where it's heading and if people really think long term it will switch to a buyers market.
thanks
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@tofuu: It's possible. Hard to say. the buyers already have a ton of actual control (moreso than in F2F and other online seller venues) with escrow. That alone puts a significant price premium, since a buyer could easily scam and at least recoup 50% of the purchase price.
That being said, with direct-buy option now availbe (send BTC straight to user) I personally will be offering discounts if someone wants to make a purchase this way, because I dont' have to price in BTC fluctuation and I dont' have to worry about scammers. I can sell at F2F price + shipping and it's a fair profit and customers get a better deal. It seems to be moving that way already, and the premium really lies in safety (for buyer) and cash-flow tie-up/scam risk (for seller). I can't see them getting much better for in-escrow purchases, maybe a bit but not much.
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Generally speaking, stuff on the internet is going to cost more until people from all over (wherever) show up to sell. Just like in real estate, it's all about location. I know on places that do not have MMJ laws or no bordering states with MMJ laws, then good quality grown dank is going to run you more than it would in California or Colorado, just like a seller from NJ would possibly have heroin for cheaper than most other places around the US.
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I think the market--like all markets--aims for balance. If someone else charges too much, or keeps having problems with delivery, someone else steps in and competes. That's why the illegal drug market is so efficient. The illegality just makes it more honest, strangely enough, as government can't control the prices, or tax them. SR right now is working just fine. Problems, as I see it, are simply that certain products are difficult to obtain...heroin, dilaudids, for example...and so we put up with sporadic sellers, and uneven deliveries, and are very forgiving of problems, simply because there is no competition...if any seller of these kinds of products, actually got it together to deliver regularly, he'd have a very difficult to beat position. Right now it's wide open, and people who desire these items take chances they normally wouldn't.
Even sellers who know the opiate crew is steady and ready, seem to have trouble obtaining product, or getting it delivered. One of them will get his act together, or another potential seller will realize the profit possibilities here, and step up. Lots of demand, zero to little supply = ++ profits ... sellers who get in early will lead the pack, and the posting order always favors them.