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Author Topic: Larger retailer exploring Bitcoin, need your feedback...  (Read 694 times)
MarkAz (OP)
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June 12, 2013, 09:46:45 PM
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I'm responsible for developing the backend and software at a company based in Arizona called 'Ultimate Consignment' (UC for short).  You can check out this video to get a sense of what the stores are like:

http://www.youtube.com/watch?v=oibjkpYb_oI

But basically we're like the real world version of an eBay or Craigslist - everything we sell is in our physical possession, and we do the pricing research, write the descriptions, take the pictures, etc.  We don't use any stock photos, and everything you see are pictures of the actual item, not similar items.  Right now we have two locations in Arizona (Phoenix and Mesa), each one is about 70,000 square feet, so in terms of size they're larger than your normal grocery store, but smaller than a Walmart.  We get basically everything under the sun, from refrigerators to Snap-on tools to furniture to high end art.  It's almost all obviously used (since we're a consignment store), but we do occasionally get new items occasionally.  We currently sell things online via Amazon and eBay (the bulk of our sales are in-store, but we sell probably 100+ items a day online).

I've been pushing for our support of Bitcoin, and we're finally pulling the trigger on it.  We also developed a competitor site to Craigslist called Ultimate List (UL for short), and that's how people can currently view things that we've got in inventory.  It's still in beta, so only a few people have access to post listings on there currently, but once it's out of beta, then people will be able to post things for sale on there for free.  You can check it out here:

http://www.ultimatelist.com/

So, my question is this - what would you like to see in terms of integration, and am I wrong in thinking that pushing for Bitcoin support for our sales is a good thing?  I think we're kind of like BitCoinStore, except we're used goods - so you get even better deals.  Wink  Let me know what you think, and what you'd like to see from us as a retailer...  Right now my focus is on getting Ultimate Consignment supporting Bitcoin, so once that's done I'll be looking at how to better integrate it I'll look at enhancing UL as well.

Feel free to ask anything, nothing is set in stone yet, so I'm hoping a good discussion with the BT community can results in something that I already think is pretty cool to become even better.  Smiley
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June 12, 2013, 11:16:09 PM
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I think is fantastic. The more shops supporting bitcoin integration the better, I think UC adding BTC makes a lot of sense. There's the possibility of expanding your online market by standing out. I'd be curious to see what items are bought with bitcoin vs fiat. I think if you can spot trends with certain items, it will definitely be worth adding bitcoin support. Also, you obviously get the chance to market your store to the bitcoin community through the forums/ reddit.

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June 13, 2013, 03:20:46 AM
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Great.

What would be even greater is if you can not only add BTC as a payment option, but also give sellers the option to be paid for their used goods in BTC. So your company would not just accept USD via bitpay/coinbase, but would also keep a BTC balance on hand to pay sellers (or even if there are any employees who wish to be paid in bitcoin. Internet Archive pays some of their employees in BTC.)

It would be even cooler if you didn't use a payment processor and maintained the BTC wallet and cart yourself. BTC community likes companies that accept bitcoin as USD thru Bitpay, but we like companies that have native BTC support even more.
MarkAz (OP)
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June 13, 2013, 05:03:55 AM
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Thanks for the comments so far - I agree with you about tighter BTC integration being desirable... There are two big challenges for us from a business perspective. 

The first one is to validate that Bitcoin actually makes business sense for us to accept - which I obviously believe it does, and will be proven out by sales.  I've already done the hard job of explaining to all the key people what exactly Bitcoin is, how it works, etc - and while they don't necessarily get the nuance of it, they love the principle of it, which is why we're doing it. 

The second issue is a bit trickier, and that is actually holding BTC in it's BTC form - for a larger company, it's an accounting nightmare...  I spent a fair amount of time with our interim CFO playing around with different scenarios, but from a GAAP standpoint it's a no go. 

Now, that's not to say that we might not be able to issue payments, etc in BTC in the future (even the near future), but more than likely we would do it by spot-purchasing the BTC, not actually holding it on hand.  While it means there is some transaction cost to doing it, it would be transparent to our users and wouldn't cause the bean counters to have nightmares.

I like your suggestion though about at some point allowing the consignor to opt into getting their payment in BTC - in that instance, we could only convert our percentage to USD, and just transfer the BTC portion to where-ever they like.  I hadn't really considered that, but it's a great idea.

The funny thing is that quite a few of our employees are pretty excited about us supporting BTC, and want to get a portion of their paycheck in Bitcoins - which I also think is pretty cool.  Smiley

Right now we use Bitpay as our payment processor, and their API is dead simple, but to be fair, after integrating with places like eBay and Amazon, places like Mt.Gox are a piece of cake... Right now I'm really focused on making sure that the buying side of the equation really works smoothly (for both us and the buyer), so I'm more than happy to give them 1% to not have to worry about any kind of regulatory issues (since they're a pure merchant services provider).

The cool thing I think we bring to the Bitcoin community is the shear size and diversity of the things we carry - each store averages about 100,000 unique items at any given time, and typically adds about 2,500 new items per week.  Right now we have two stores, but we plan on opening a third in Las Vegas before the end of the year (it might not be opened by then, but we'll have the building locked up, and be busy doing the TI to bring it up to spec for us).  Our longer term goal is to open 20 stores in the next 3 years, so assuming we can maintain that, we'll have a TON of things that people can buy, and lots of physical locations that they can even come down and check things out.
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