Did Sony Profit from the Walmart $100 Discount?

[Bodhesatva]

I Perdict said:

bumidan said:
@ I Perdict

Yes, I was just using PS3 as an example - as this is a video game site.

However, even if it was for any Blu Ray player (eg. Samsung), the calculations should still be the same.

Therefore, for any other Blu Ray Player - Walmart must be making at least $94 for them to BREAK EVEN in this deal.

So $94 is the actual dollar margin on any Blu Ray player for this promo to BREAK EVEN for Walmart. Because if it is not, why do it? Wherever that $94 comes from, i don't know - but it has to come from somewhere, and most likely the manufacturer is shouldering most of that.

You're thinking too much about it.

Promotions go as sunk costs a lot of the times

Wal-mart is a huge company and can afford it

Also you are taking into account wal-marts profits are a set number

Wal-mart sells things that are more profitable. (Ex: Ice, slushies, gum balls, 25 soda, wal-mart brand items.)

Do they charge intrest on lay-a-way?

Ah ha ha ha! What an absurd post.

Why would Wal Mart lose money here? Because, according to you, "Wal mart can afford it." Yes, that's how big business works! They're willing to lose millions of dollars to help out other companies, just cause they have tons of money and don't know what else to do with it. Next up: Google will provide their services for free to assist the Wii. Nvidia will provide the Xbox720 with its GPU for free next time. NVidia is incredibly wealthy, they can afford it. So why not?

There is absolutely no way that Wal Mart is shouldering the burden here. That isn't how these deals work. Wal Mart is not in the business of helping Sony or Nintendo or Microsoft; if Sony dies, Wal Mart just makes more room for Microsoft and Nintendo games. Simple as that.

When these sorts of sales go down, the manufacturer of the product on sale shoulders most of the burden. Always. Retailers have very little to gain from promoting a single product, especially when the retailer is as big as Wal Mart.