Lessons Learned

Apparently, author Sara Gruen has landed herself in deep trouble. Hatchimals are apparently this year’s hot toy, reportedly comparable to the Cabbage Patch Kids of my youth. Gruen reportedly is working on a documentary to free an unnamed innocent man serving life without parole for a crime he did not commit and has racked up $150,000 in legal fees. So when she heard about Hatchimals she decided to spend about $23,000 on Black Friday and then turn around to resell them at the uber upsold price on $189.00 (suggested retail price being 59.99).

Things got worse for Gruen when she found that Ebay restricts the sale of toys likely to attract counterfeiters. In otherwords, she could only sell 3 per week, not near enough to get rid of the 156 she bought before Christmas.

So she turned to the internet, and quickly got burned by parents desperate to find the in demand toy and wondering how they will be able to afford it at nearly three times the retail price.

Overall, I think this is a good example of think before you act.

Others have pointed out that this was a dumb financial move on Gruen’s part. One thing that got lost in the uproar over her actions is that Gruen already bought the toys at a marked up price, average of $150, meaning if she was going to make a profit she would have to up the resale price even further (her site has them listed for 189-199).

My first thoughts when I heard about this, before I’d even realized she had bought the toys at an inflated price, was that she made a risky move by purchasing collectibles. As a teen I collected Star Wars and Star Trek items, branching into anime items as a college student. While I would check and see if my stuff was valuable, the message I constantly got was purchase for the love of the item, not the financial gain. Trying to predict what will be valuable and what people will pay for it is risky. Anyone else remember Beanie Babies?

As a bestselling author, Gruen had means to hold silent auctions, book signings, heck even bake sales, to raise funds for legal fees. And considering what has happened since this story went viral, appealing to those avenues would have been a far better choice.

And because of the media attention, Ebay did eventually allow her to sell more on their site, and because of her fanbase, she has now sold 40% of her inventory.

Lesson here, she could have avoided getting herself $23,000 in the hole and avoided the bad press had she gone with a bake sale. People who have means, a platform and an audience can be saved from their mistakes. The average Joe would be ruined.

Now, what about the parents frustrated over finding the in demand toy in time for Christmas for their children?

I’ve heard some people dismiss this by saying that kids shouldn’t always get everything they want. And that is true. But keep in mind some things. We tell our kids that Santa brings them toys if they are good. And kids from wealthy families are going to get all the things that kids from impoverished families won’t. Overall, this will hurt those families that don’t have the means more than those who do. And this is one of many ways that we grow up in this country learning that people of wealth and means did something to earn those while people who don’t have either earned the nothing that they have. And if you want to know the long term consequences of that, check out CNN.

On a more personal note, considering my son is autistic, he can’t tell me what he wants for Christmas. One day that will change, and when he is able to, you bet I want to make sure I would be able to get him what he wants at least that first time because of the milestone it would be. And I would be furious if I couldn’t because someone had snatched up 156 to sell at a price I can’t afford.

Simply, I’m not down with fleecing parents over the in demand toy. And considering people are coming to her rescue because of her platform, while people who don’t have a platform are increasingly feeling unheard, unvalued, and frustrated, yeah. I can see why people are angry, and they have reasons to be. That said, I’m also not down with the death threats Gruen has gotten. It is not okay and needs to stop. However, she deserves the criticism.

There are no winners in this story. Just a cautionary tale. Beware of easy money. Do your research. And don’t make Christmas time even harder for overburdened parents already stretched thin.

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