How can ebay sellers make a profit on current bags?

I wondered if certain sellers have purposely bought unrepairable Coach bags on the bay (or wherever), sent them in to Coach to get "repaired" betting that Coach will send them the full credit, then use the credit to buy a new bag, sell it at a lower price on the bay, and still make a hefty profit.
Not that I'm condoning that but really whats wrong with it? It is coach's policy to repair their bags and if not send a credit. If the seller doesnt do that why cant the buyer? I know I have bought a bag with a broken turnlock before and a realy good deal on it and had the turnlock fixed for free. Am i wrong for doing that?
 
I'm sure there are a number of different ways these sellers get thier bags. Some people scout the outlets. A person can buy a newly released bag at full price at either a boutique or, even ordered from Jax and they can then return that bag to an outlet. So, then, the outlet can put that bag out on the floor at a discount.

I think Previous posters are right too. Some people may get good deals on damaged bags then, send them into Coach and get merchandise credit.
Some people may even be getting these damaged bags from department stores. I went into Von Maur one day and seen a huge box completely full of Coach bags so, I asked about them. The SA told me that they were all returns and had to be sent back to Coach. I just wonder if some of these SA's just take some of them home.

There is a seller on ebay right now selling nothing but, damaged bags. They have like 10 Coach carlys in thier store and almost all of them are frayed at the top.
 
Not that I'm condoning that but really whats wrong with it? It is coach's policy to repair their bags and if not send a credit. If the seller doesnt do that why cant the buyer? I know I have bought a bag with a broken turnlock before and a realy good deal on it and had the turnlock fixed for free. Am i wrong for doing that?

No, you're not wrong at all. From what you've posted, you actually had your bag repaired. To be able to buy a "defected" bag at a great price and then have Coach fix it is a win-win situation. That's outstanding that they fixed the turnlock for free!

I was referring to those who intentionally scout for unrepairable bags. These would be the sort of Coach bags the seller is 99% sure Coach will issue a merch credit for certain conditions. And, I guess if Coach is OK with that, then no harm, no foul.

I do think there are questionable business ethics involved. I'm going to venture to guess that part of their profit margin has to account for these credits; therefore the Coach consumer ends up paying for it indirectly. Just a guess.