A couple weeks ago I went back down to
Fukuoka on business. I tried checking
out some of the game shops I used to write about on here, including Mandarake
and 007, while I was in town to see how things are going.
What I found made me realize an important
and, I hate to say, sad fact: most of the posts I put up here during the Golden
Age early years of Famicomblog are now hopelessly out of date. I don`t just mean that the details, like what
shop had what games, are out of date. I
mean that the entire reality of retro video game collecting in Japan which they
depict is one which no longer exists.
To put this in extremely simple form: 5
years ago retro video games in Japan were easy to find and cheap. Now they are hard to find and expensive.
And this kind of sucks. At least if you live in Japan and collect old video games.
I`d like to devote one of my longer
essay-type posts here to talking about how the used video game market in Japan
has gone from one which just a few years ago was full of amazing bargains to
one which today features way fewer of them.
I`m going to do so by looking at the development of three distinct modes
of buying retro games in Japan and how they have changed over time – big recycle
shops, specialist game stores and online auctions. First up will be the big recycle shops…
The
Peculiar History of the Market for Second Hand Goods: Hard Off and the Big Recycle
Shops
Most people who have spent some time
collecting old video games in Japan are no doubt familiar with the big second
hand goods stores, often called `Recycle shops`. The best of these in terms of hunting for retro games
are major nationwide chains, like Hard Off/Book Off, or regional chains like
Manga Souko in Kyushu. These can
sometimes turn up amazing treasures.
If you haven`t been here for too long
though you might not realize that these types of stores are actually a
relatively new feature of Japan`s retail landscape. When I arrived here for the very first time
in 1999 they were only just starting to appear and prior to the 1990s none of
them had existed at all.
Second hand goods in Japan before that time
had been a relatively small niche market dominated by pawnbrokers (which still
exist but generally trade in higher value goods rather than old video games and
thus aren`t on most video game collector`s radars) and smaller mom-and-pop
style second hand stores. During the
bubble economy era of the 1980s there seems to have been a social
stigma associated with buying used goods in general – one often hears stories
of how people instead of selling perfectly good electronics items that might
sell for big money in America, would instead just put them out as trash.
More importantly though, the structure of
the used goods market before 1995 was heavily influenced by regulations set out
in a law called the Used Goods Dealers Act. (For information on this I am aided
by a series of very interesting articles by Prof. Frank Bennett entitled
`Second Hand Japan: Used Goods Regulation 1645 – Present`). The Act, which was
passed in 1949, mainly regulated the trade in second hand goods from a theft-control
perspective, viewing it as a problem (since people could fence stolen goods
through second hand stores) more than as a market worth promoting. One of the key requirements of the Act was
that all businesses operating second hand goods stores required a special
license to do so. This wasn`t in itself
necessarily problematic, but these licenses could be revoked if a business was
found to have sold stolen goods. Since
the license was granted to a business as a whole rather than to a specific store,
Prof. Bennett opines that this largely discouraged the development of
businesses running chain recycle stores.
Under those regulations, if a chain like Hard Off had existed and one random
part time employee of at one of their hundreds of locations had inadvertently
bought and sold a stolen TV for example, the entire chain (as opposed to just
that one location) could be shut down. The
risk of that happening thus prevented Hard Off and other chain recycle shops
from existing under that system – nobody would be willing to take the risk of
creating a business model with such an Achilles heel.
A second area of regulation which affected
second hand retailers is that affecting
large scale retailers. Prior to the late
1990s large scale retailers (ie box stores) were subject to a fairly rigorous
approval process whenever they wanted to open a new location. Small scale retailers had a lot of say in
that process and could effectively veto plans for any stores that might harm
their interests opening up nearby, which meant that there were actually very
few large box stores in Japan until the turn of the 21st century (department
stores and supermarket chains like Daiei being an exception). Since most of the
big recycling stores today are based on a box-store type business model (they
need a lot of floor-space to stock a wide range of goods in order to attract
customers), this feature of the regulations also prevented Hard-Off type
businesses from existing.
In the late 1990s both of these areas of
regulation were significantly changed, with the licensing system for used goods
businesses abolished in 1995 and the approval process for box stores
significantly de-regulated a couple of years later. Not coincidentally Hard Off opened its first
location at this time and the chain stores that we know today began popping up
in all corners of the country. This was also
helped along by the negative economic picture in Japan in the late 1990s, which
made people appreciate the value of used goods more than they had previously.
Famicom and other retro video games were
among the variety of goods which these chains would stock. Importantly at the
time these chain stores were starting to appear in the wake of deregulation,
the Famicom was still a relatively recent item (Hard Off opened its first
location only 2 years after the last Famicom game was released) and thus retro
games weren`t treated as collector`s items but rather were dealt with in the same way that books,
CDs and VHS cassettes were – just used things that people might want to use.
The business model of these shops generally
involved (and still involves) people driving up with carloads of old crap they wanted to get rid of and
just taking whatever the shop clerk offered them for it. The clerks would then slap a price on stuff and
throw it on shelves. With things like
old video games there is very little consistency among shops within the same
chain as to what to charge for a specific game. They were just another random
commodity and the store could only make money if they sold things in volume, so
the clerks could, given how little they paid for the item (one Hard Off I visited gave a flat rate of 10 Yen per Famicom game regardless of the title) put whatever price they wanted on something. This made these shops a collector`s paradise
if you happened to be in the right place at the right time.
When I first arrived in 2008 I got most of
my games from chain stores like these – especially Omocha Souko which I have
numerous posts on here about. Two big
things have happened in recent years which have really changed the usefulness
of these shops to video game collectors though.
The first is that both the shops and the people driving carloads of junk
to them have obviously become much more aware of the fact that video games are
a collector`s item than they were 5 or 6 years ago. I don`t have as much time as I used to for
video game shopping, but I still drop by Hard Offs and similar stores every
once in a while and it has been a long time – years – since I found a great
bargain at one. The standard experience
I get when I walk into one today is a retro game section consisting of a rack
full of Super Famicom tennis and soccer games for 500 Yen each, along with a
pile of broken PS1 controllers (this is what I found at 007 in Fukuoka the other day). The days
when clueless people would dig out a box with 50-100 games in it that was
covered in dust and included copies of rarities like Gimmick in it, truck it
over to a Hard Off, sell it to an equally clueless clerk who would then dump
everything into a 200 Yen each bargain bin seem to be over. TV shows highlighting the collector value ofvideo games have probably played some role in this.
The second problem is that the big chain
stores themselves are starting to disappear.
My beloved Omocha-Souko of course closed down in 2012, but it is hardly
alone. I don`t have any data on this,
but I do know of several other chain recycle stores and Book Off/ Hard Off
locations which have closed in the past 4 years (and none which have opened in
the same time). Book Off seems to have
been particularly hard hit, the suburban Japanese landscape is becoming
increasingly cluttered with box store locations that you can easily tell are
former Book Off locations based on the distinctive yellow and blue color
pattern left on the buildings. Increased
competition from online auctions is the most likely culprit, and I will get to
them a bit below.
Basically what I want to say though is that
the big chain recycling stores are kind of an interesting, but probably
disappearing, element of the retro game collecting experience in Japan.
De-regulation in the 1990s allowed them to burst onto the scene and for about a
decade they provided an amazing source of cheap games to pick over. That window seems to be closing now, which is
kind of a shame. Glad I was here to experience
it while it was still open though.
The
Video Game Specialists – Mandarake and Super Potato
In the previous section I mainly talked
about large recycling shops, but its important to bear in mind that those shops
generally don`t specialize in games or have any knowledge about them. Some shops, however, do specialize in games
and cater to gamers (and collectors of games) in particular.
It is hard to find information about some
of these. Obviously game shops have
existed since the first video games went on sale, but what about game shops
that specifically stocked used games?
Anecdotal evidence from my travels suggests that a lot of mom and pop
style shops did start to spring up during the Famicom`s original lifetime. Coinciding as it did with the above mentioned
regulatory framework favoring small retailers these seem to have been small, family owned
businesses. Many of the smaller ones I
visited in Fukuoka while I was there seem to have closed and I don`t have a lot
of info on them. But two of the more successful ones which eventually became chains – Mandarake and Super Potato –
we can talk a bit about.
Aside from both being chain stores that
often operate in close proximity to each other, Mandarake and Super Potato are
quite a bit different creatures. Super
Potato is actually the only one that really counts as a `pure` retro game store
since that is all it sells, while Mandarake sells a wide variety of other goods
(mainly comic books, toys and cosplay stuff).
An important common feature they have though is that unlike the big recycle
shops they both have specialist staff who know the value of games and have long
priced things accordingly.
It would be really useful to know a bit
more about Super Potato`s origins as a store, but the internet doesn`t really
tell us much (at least as far as I can find – anyone out there know a bit
more?) Its website says nothing about
the store`s history, nor does the Japanese Wikipedia page or any other sources
I could find. Mandarake, on the other
hand, is a publicly traded company listed on the Tokyo Stock Exchange and subject
to certain disclosure requirements and thus it is much easier to find out
historical information about it.
The first Mandarake store was opened in
Nakano (Tokyo) in 1980, under the simple name `Manga Used Book Store`. Judging by the name it likely specialized
only in comic books at first. Business
seems to have gone well and it was incorporated in 1987 under the name Mandarake
with a capital of 2 million yen (about $18,000 US at today`s exchange rates,
not a huge sum). It opened its second
store in Shibuya in 1994 and in the following years would further expand to
Nagoya, Osaka, Fukuoka and Sapporo, as well as opening further locations within
Tokyo.
Its sales have grown year on year – from 1.4
billion yen in 1995 to 8.6 billion yen in 2012 (the last year for which data is
posted on its website). This would seem
to indicate that it is doing well, but it is a bit difficult to determine how
much of this amount is attributable to retro video games (which generally only
take up 10-20% of floor space at the Mandarakes I have been to) and how much is
from other merchandise.
While we don`t have much information on
Super Potato`s origins, we can piece together a bit of its recent story based
on information about store closures. According
to its Japanese Wikipedia page, 10 different Super Potato locations have closed
across Japan since 2009, with 8 of those coming in the period 2013-2014. In the same time period, only one new store
(in Nagoya, as first reported here on this very blog!) opened. For a chain that currently has only 10 stores
in operation, closures of that scale are huge.
This isn`t a perfect comparison, but I
think it can generally be said that Mandarake is a growing business while Super
Potato is a shrinking one and the main difference between them is that Super
Potato is a pure retro game shop while Mandarake has a much more diversified
product range. It is hard to speculate
about what problems Super Potato is facing (I note that its prices have always been on the high side for Japan), but I suspect some of it might be
owing to the above mentioned changes in the retro video game market as a whole –
it is simply getting harder to find cheap stock on the one hand, while
increased competition from online auctions is probably biting into their
customer base more than it is for the more diversified Mandarake. Either way, Super Potato is kind of the
market leader for retro game shops in Japan and if it is doing bad, this bodes
poorly for other specialist shops too. This
brings us to….
The
Online Market – Yahoo Auctions
Finally we come to the big elephant in the
room – online auctions. Even online, it
seems, Japan has to be different from the rest of the world. Ebay tried entering the Japanese market in
the early 00s but quickly withdrew after failing to make much of an impact
(probably due to the prevalence of postal accounts, which allow for free
transfers between buyers and sellers.
Paypal fees? No thanks.) Yahoo Auctions is the big one. And at any given moment it has
a huge amount of retro video game stuff up for bid.
I have been an active user of Yahoo
Auctions (only as a buyer) for almost 5 years now and I can say from firsthand
experience that the market has changed radically in that time. In keeping with the above description of the
big recycling shops, when I first joined Yahoo Auctions it was obvious that a
lot of the games were being sold in lots by people who didn`t have much idea as
to the rarity/value of the games they were selling. This suggested that people who would
previously have been dumping those games at recycling shops were now dumping
them on Yahoo Auctions in order to cut out the middle man.
Most interesting though – and fun for me at
the time – was that the auction prices never seemed to go too high. Often you could get stuff for a tiny fraction
of what it would sell for on Ebay. So in
addition to relatively uninformed sellers you also had a fairly laid back set
of uninformed buyers bidding on the stuff and building up nice collections on
the cheap.
This dynamic no longer exists. Sellers now are obviously
way more knowledgeable than they were in 2011 or 2012 – you almost never see a rare
game stuck in a huge lot anymore, and on rare occasions when you do the seller
has usually put that game`s title prominently in the description. Prices too have gone through the roof – I wouldn`t
say there are no longer any deals to be found, but when you find them they tend
to be much more modest (no steals, but maybe some decent priced stuff) and they
happen way less often.
Japanese bloggers generally chalk these
huge price increases on Yahoo Auctions to overseas buyers and I think that is
probably the case. One big piece of
evidence supporting this theory is the correlation between exchange rates and
game prices on Yahoo Auctions. The first
big bump in prices I noticed happened shortly after the Yen lost a large chunk
of its value against the Dollar about 3 years ago (which wouldn`t have happened
if only domestic buyers were to blame). Another
is that proxy services which allow overseas bidders to bid on stuff seem to
have proliferated over the past few years, making the Yahoo Auction market much
more open to the rest of the world than it was a few years ago (and thus much
more easily influenced by foreign prices). For famous and hard to find games
(Contra, Crisis Force, etc), the prices on Yahoo Auctions in 2011 for single
copies used to be easily half what you would have paid on Ebay, but now they
are pretty close to even. It is really
hard to explain this increase based on any changes particular to Japanese
collectors, so I think the influence of overseas buyers is by far the
biggest factor driving this. This of course has side effects
on physical stores in Japan, who in addition to having more difficulty getting stock in the first place are also more incentivized to sell their
games on Yahoo Auctions where they can reach overseas buyers willing to pay
much more for games than Japanese buyers are, thus making the brick and mortar
stores even less appealing to bargain hunters.
Conclusion
It is kind of sad to say but I think the
market for retro games in Japan has basically gone global, meaning the
selection of games and the prices charged for them to collectors living in
Japan (or visiting) is a lot less attractive than it used to be. A lot of the stuff I said in posts like this
one here simply doesn`t seem to be the case anymore. The big recycling shops that used to dump treasures into junk bins are disappearing and the ones which still exist don`t get many treasures to dump anymore. The specialist stores seem to be having trouble making their business model work in the era of online auctions. And the online auctions have seen prices explode over the past few years, which has effects on the other two. Its an irreversible cycle that will probably continue down that path for a while before it hits some sort of equilibrium when prices stabilize on the international market.
This isn`t to say that you can`t find bargains, they still probably exist out there. Somewhere. But the wild west days of finding copies of Gimmick for 100 Yen seem to have past us by.
This isn`t to say that you can`t find bargains, they still probably exist out there. Somewhere. But the wild west days of finding copies of Gimmick for 100 Yen seem to have past us by.