I have a good friend who owns a comic book shop. We were talking the other day about branching out. I asked him if he ever considered selling video games, as it sort of fit in with the theme of his shop. He told me that at one point he had considered it, and still thinks about it once in a while, but noted that the “real” money was in used games, and that was something he didn’t want to get into right now.
I thought about it more. There is a lot of vitriol towards the big brick-and-mortar retailers such as Gamestop, and I wondered why. These stores pretty much thrive on the used games market. What is the difference between transacting in used games and rental? Not much except for profit margins. This is why you see game “stores” open up inside of video rental stores.
Personally, I avoid buying used games. I don’t begrudge those who buy them, but I would rather support the developers of games than the retailers who really don’t add any value to the product. I collect my games at any rate, and would never dream of selling one back. Once a game is purchased by the retailer, the developer has already seen that money the one time they’ll ever see it – from then on, the retailer makes the money every time the game gets sold again. They could theoretically sell the same game (and profit from it) many multiple times. This does nothing to ensure continuing development of great games, so I try to avoid it.
I read at ArsTechnica the other day that one of their columnists received a phone call from Gamestop, asking if he enjoyed his copy of Twilight Princess and if he brought it back, they’d happily buy it from him! This is going way too far, in this writer’s humble opinion. Some of the newest games only have a $3-$5 markup from the rate they pay out, but some of them are incredibly huge profit margins – sometimes more than $25!
If you want to buy used games, at least be mindful of who is actually getting your money. If you want to support your local brick and mortar game retailer, then by all means buy used, because you are giving them a reason to stay in business. If you prefer to have your purchasing power optimized for supporting developers directly, you should never buy used games. 
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