Wal-Mart, not MS, PAID FOR $100 gift card with Xbox 360 Arcades

[strunge]

izaaz101 said:

strunge said:

it's a no lose for Wal Mart. at the end of the day, they aren't losing $100. at the least, they pay only $100 for each 360 arcade anyway (retail price to wholesale price is generally double, so that would be the case if it holds true for game systems, I honestly don't know), so they break even on that cost with every sale, make you buy an extra $100 in the future (which you'll probably spend over and thus pay them more for the transactions just to use it up) and make a profit on your other $100 plus of transactions while getting rid of their stock of 360's. sounds like good business to me.

I was under the impression that video game hardware is "generally" sold at cost for a long time, and then at a slight profit, by the retailers. Their money is made off of the software.

manufacturers take the loss, but why would retailers pay $300 for the system only to sell it at that amount and risk losing that entire $300 if it doesn't sell.  retailers could simply sell the games and make the profit from them and let someone else sell the systems.  I don't know how much they make from the systems, but they make something worth their while to carry them. that's just the way retailers work.