[Shopping 0006] Hot Wheel tracks shows dropshipping still thrives in 2022

I've recently been in the market for some Hot Wheels tracks and one thing my brother said always stuck with me, "Value perceived is value received". Hot Wheel tracks are simultaneously simple and complex. They are a piece of plastic that uses a unique connector that makes them modular. Consequently, they are difficult for a layman to value. We all know that it's plastic and injection molded by the millions if not billions. However, we don't know the technology behind the connectors and if there's anything special or proprietary about them. So, even if we know the material value is say $.10 we aren't sure if a track is actually worth quarter or a buck. As such, Amazon has overpriced Hot Wheel tracks that appear to be dropshipped from DollarTree and Walmart appears to have Hot Wheel tracks that are dropshipped from Amazon. Ebay has dropships from both Amazon and DollarTree. Here is a rough diagram of the dropshipper's supply chain.

Here are Amazon tracks that appear to be the exact ones sold at Dollar Tree for a quadruple the price.

I actually went to Dollar Tree to try and find them and there was only one pack left (my header image). Komodo Dragon is right-ish. They are $1.25 for 2 meaning that the 4 pack there costs $5 making the $19.99 a 400% markup or 75% gross margin which is quite good. The rabbit hole goes deeper.

Here are Hot Wheels tracks sold on Walmart that are the exact same ones sold at Amazon (I bought the set), which is an Amazon exclusive meaning that they are getting it directly from the manufacturer. It even has the same image.

Now, because it has a higher base cost the markup can't be as high, but a 100% markup with a 55% gross margin is still a pretty penny. Someone who has deep pockets who happens to have Walmart+ *cough* AMEX holders *cough* who values their time might not cross reference the prices and just purchase it. After all, value perceived is value received and 40 feet looks like an awful lot of track. We're almost at the end. All roads lead to Ebay and what we're seeing here is every piece of Hot Wheels generic being sold here. If one of the big box retailers have a sale you will inevitably see a listing here with the discounted price marked up.

This last listing looks suspiciously like the Amazon exclusive with custom image. Just kidding, it's ripped off Amazon and is simply not the main image on the Amazon listing. And you know $40 for 40 feet of track doesn't actually sound like too bad of a deal. As to why Target is not part of the secondary market. It's simply because they have a restricted marketplace that is tightly controlled much like Apple's appstore. This prevents drop shippers from participating in their marketplace, which allows Target to maintain a curated and premium experience--unlike Walmart's clusterf*. Selling Hot Wheels is the classic arbitrage dropshipping technique that is tried and true. It’s good to know that old tricks still work.