Tuesday, October 31, 2017

Back to One

Happy Halloween everyone!  The end of October also marked the end of my Tempe location, so for the time being, the new store at 3875 West Ray Road in Chandler is the one and only Desert Sky Games.  Our game room is open, it's gigantic, and its capacity is continuing to increase as we bring in equipment and assets from Tempe and deploy out our rack and fixture.

The effort to build a regional empire that I described last year around this time, and then revised, and then revised again, has finally coalesced into the establishment of One Big Hub Store, which was really a prerequisite to the model I wanted moving forward.  Spokes/branches don't work unless a hub serves them, there are underlying logistics that are mostly transparent to the end user but we did not have them in place and could not have them in place for as long as the Tempe location was configured like a hub, but was not situated adequately to do business as a hub.  Now that the far larger Chandler store is unambiguously the one and only company HQ, branch locations may follow for the low price of buildout and equipment.  Look for our first in the spring, unless we decide to hold off a bit longer and lay in reserves.

Note that the business name no longer includes "and Comics."  Comics are still happening here, though.  I've been asked a couple of times whether that meant we had shed the category.  While I think that's coming at some point, it's not happening yet.  "Desert Sky Games and Comics" was just a really cumbersome and inelegant brand representation, and I saw plenty of industry stores doing dependable business in comics without bolting on the word, such as Millennium Games, Madness Games, Nerdvana, et al.  "DSG" needed to stay lean and mean in the market mindspace.

They say you never have a second chance to make a first impression.  In case anyone reading thought that was only a canard, let me tell you, it's proving more and more real every day.  From day one, DSG Chandler's shelf presence was strongest in TCGs, board games, and miniatures.  We have the video games out but not really set up like we want.  RPGs, comics, and other subcategories are only partly set.  Lo and behold, sales of TCGs, board games, and miniatures far and away lead the pack.

I don't think there is a tremendous market difference between Gilbert and Chandler.  What I think is that Gilbert spent 2012 and 2013 sucking at board games, so the customer public knew to disregard us to some extent.  We ramped it up in 2014 and 2015, but in addition to fighting against our own prior poor impression, the board game market itself went into some upheaval during that time, which I've chronicled extensively on this weblog.  In 2016 I was ready to be out of the category, despite being a board game player myself.  I had a category I loved that didn't love me back.

But as of 2017 we saw some of that work begin to bear fruit.  We started to focus on finding key titles and getting in deep in advance, sticking with protected brands, keeping mainstream-accessible low-price titles available, and like such.  In May and June, we ran a moving sale culling everything that wasn't the latest and greatest; we knew the rebuild would bring back anything that was still relevant.  And then with the move to Chandler, we had a chance to fix that brand impression.  The result has been a board game category that consistently finishes in the top 5 every day, rather than almost never doing so.

It isn't the answer to all things, not by a long shot.  Any category whose buyers were truly as fickle as that would not be worth catering to.  What I hoped to do, and appear to have done, was to be positioned as a legitimate source that people will check first, or almost first.  As long as some number of them do so sometimes, that should suffice to drive core sales in the category and present a dependable day-to-day revenue figure.  My responsibility then shifts to ensuring that the back-end economics are not wasteful or broken.

One category at a time, we need to get the stock deployed cogently, the organized play (where applicable) scheduled and running effectively, and then the marketing underway.  The brand impression has to bring people in knowing they will find things that surprise and delight them.  And when that is happening every day, we will know the time has come to resume the branch expansions.

Tuesday, October 24, 2017

September Sun, October Rust

Okay, I've put upon you long enough.  Thank you for reading weeks upon weeks of "DSG's big move" coverage here on The Backstage Pass.  And if you skipped the articles as soon as you saw my increasingly cryptic titles?  You missed all the juicy dirt and gossip, but it's too late to go back and read it all, as I've edited out the best parts.

Time to get back to what's happening in the greater comic and hobby game industry, and rather than spend a few kilowords on a single item, I'm going to do a quick round-up of assorted things that happened in September and October (so far) that caught my incredibly limited spare attention during that time.
Peter Steele, 1962-2010, official mascot of October
September and October have been the blessed Autumn Gothic Relief for game stores everywhere for years now, mostly owing to the arrival of the new Magic Standard environment and a brand-new stand-alone expansion to kick it off.  Not so this year apparently.  The new Magic set, the wildly well-received pirate-and-dinosaur romp "Ixalan," has sold at par for my two stores but I'm being told has seen tepid response for many other retailers.  Some peers and I have been fiddling around with something of a nationwide store closures list.  That list grew noticeably these last six weeks or so, and looks poised to grow further.

What happened?  Reasonable people are observing as we go and trying to draw meaningful conclusions.  It appears to be some combination of booster boxes being available for a few bucks over wholesale on Massdrop and elsewhere, the glut of product that is bringing us seven booster releases in 2017, there being too many stores fighting over a pie that's not growing as fast as the store coverage count, the ordinary time and tide of the market, and whatever other question mark reason you like.  As I've mentioned before here, don't discount the calendar: Stores that opened in boom times in the fall of 2015 and 2016 are now hitting the rent escalator months in their lease, and are only now discovering they left too much money on the table, most of it in the form of discounts to the hardest edge of their customer base.  Their business framework is unsustainable, and they don't have time to fix it before they drop their transmissions at redline.

While I'm not seeing the bottom fall out locally, I am seeing that worrisome overall trend line.  Khans of Tarkir was the most successful product in the history of Desert Sky Games.  Battle for Zendikar started stronger than Khans but cliffed and never got back that level of momentum.  Kaladesh did decent business but was well below that pace, though I also attribute some of that to local competition dumping boxes to gain market share at the time.  Ixalan is a whisker better than Kaladesh was, and in any case is not making us nearly as healthy and happy as Khans did.  These holidays are going to be built on the back of other products, from video games to board games to comics and gifts.

In a world where we didn't raise our own performance ceiling a mile into the sky with a gigantic new facility, I would be moving away from Magic with vigor right now.  It appears many stores that had been built on the Magic economy in the first place are finding that there isn't enough protein elsewhere on their plate to continue.  Where will the bloodbath end?  We shall see.

Last year, Games Workshop made big news by ending its board game license with Fantasy Flight Games.  Some of those titles were among the better sellers for us, including Fury of Dracula and the Conquest LCG.  There were some high-profile games that fell victim to the pre-Asmodee dumping syndrome that typified FFG at the time, such as Relic and Forbidden Stars.  We were sorry to see those all go out of print as there was broad demand by this time last year.

Nottingham had a plan, however.  Perhaps it was Fantasy Flight pushing ever more into miniatures, perhaps it was other reasons, but they apparently wanted to give it a go with a different licensee.  That licensee was just announced, and lo and behold, it's WizKids!  Long known for HeroClix, WizKids's recent success has been most visible for us in the world of Dungeons & Dragons miniatures.  Their prepainted collectible minis had always done well, but their unpainted Nolzur's and Deep Cuts figures have performed off-the-charts great.  That raises the question of why Games Workshop needs WizKids, though, because Gee-dub seems handily able to manufacture plastic figurines.

In the intervening time, something happened that may answer this question.  Zev Schlesinger, namesake of Z-Man Games (now an Asmodee property), joined WizKids to develop board game content.  The ensuing product has been hit-or-miss, with high production values but middling results overall.  It's a similar place to where AEG and Iello have been for a while, and each of them ended up producing some great evergreens amongst the misses.  If we can expect to see the same out of WizKids, the Games Workshop license makes a lot more sense.  Warhammer is a gold-plated license with a devoted following.  A strong board game product in the Warhammer universe should be a cash cow up and down the sales channel.

In the board game world, we're seeing more and more top-tier titles released with a special "brick-and-mortar first" or other similar accommodation to get the game circulating in meatspace before the presumed hordes of online buyers procure it in their usual manner.  (We're assured by knowledgeable folks that these hordes are not as massive as the hordelings believe.)  In any case, mostly the release arrangements are working.  Dark Souls and Mountains of Madness both did well for us.  Clank In Space! is up soon and if it performs anything like its predecessor Clank!, it will be fine.  Meanwhile Codenames Disney busted out of the gate like a dart, very quickly attracting mainstream visits and purchases.  I don't think there is a substantial market difference less than ten miles from my previous spot in Gilbert, where board games perpetually struggled.  I think it has more to do with being able to open with a lot of product already visible and winning some first impressions that we lost last time around by opening as Just a Magic Store (Tm).

Speaking of which, and I won't dwell on Magic much longer in this space: Wizards of the Coast changed Magic's logo drastically for the game's 25th anniversary, and as you might imagine, the masses instantly decided they hated it, as they hate all change.  I like the logo, as it's sharp and modern and stands well off the page or screen.  I've heard a fair bit of agreement from those who have taken the time to give it more than a cursory glance.  The new logo will debut on product packaging with the spring's Dominaria expansion.

The other reason I bring that logo up is that it's the trade dress for Magic Arena, the new digital offering of MTG that is Hasbro's latest attempt to build their own Hearthstone.  And that's an inevitable development, but one I still cannot like.   Hearthstone exists in a world that doesn't need physical retail stores.  Know how we talk about how we're making hay while the sun shines and there's a trend toward hybrid deployments and so on?  Well, Hearthstone is basically designed to monetize players while offering virtually no revenue conduit to any third party they don't have to.  In terms of the FLGS, the only ones that realistically stand any benefit are those that are already far on the cafe end of the spectrum, and that's treacherous space.  A typical small specialty retailer has virtually nothing to gain and general entertainment dollars to lose by supporting Hearthstone and its organized play gimmick, "Fireside Gatherings."  Firesides are a swell thing to have at coffee shops or campus union buildings or what have you, but FLGSes hosting them are toying with peril.  I have been asked multiple times to do so and it's a hard pass, and will remain a hard pass.  If you like Hearthstone, that's fine, go play it.  But it's incompatible with my business, plain and simple, so it's never going to be supported for as long as there's no sustainable monetization structure for us.  And unfortunately, that's where Hasbro wants to take Magic.  And can you blame them?  They'd get to write off the mostly horrible and unprofessional independent retailer channel ever after.

We got let into the Force Friday party this time!  Small stores had to order blind knowing only that it was a Star Wars license item from Fantasy Flight.  The online brain trust had it narrowed down quickly enough to some sort of The Last Jedi-branded core set for either X-Wing, Destiny, or a new game.  Turns out it was Destiny.  Alas, late in the game the exclusive distributor was made to deliver the game on the day of rather than in advance of Force Friday, so a great many of our customers bought their copies at midnight at Target instead of from us.  But it's a decent product, an evergreen SKU, and one I need to have in stock for as long as Destiny is a thing, so aside from wanting to have cycled through more of it at this point, I'm OK with still having twenty-ish copies on hand.

I believe in the "soft sell" or "soft pitch," and I'm in an industry where most of the customers prefer that approach, so it's a very win-win situation.  My soft pitch is something like, "I've got a lot of really fun stuff and if you want to come check it out, that's cool, and even maybe buy some, that's also cool.  But seriously at least check it out.  I know you probably like at least something in this building as much as I do.  Possibly more."  It helps that I really do like a lot of what I sell, and my staff does also.  People can tell when you are or aren't into a thing.

Though usually I am the pitcher and not the pitch-ee, I do get pitched fairly constantly by vendors of every stripe, whether for products I already carry, products I don't currently carry that someone wishes I would so they could make money, or for business products and services in general.  And almost without variation the vendors who are pitching me are not pitching the soft sell.  There must be some sort of desperation scent in the atmosphere that I don't realize I am giving off, because I'm attracting them all these days, and this is by far the worst slate I've ever seen.

Let's count down the hits!

Third runner-up: 
A reseller of unlicensed comic-themed t-shirts came to the store when I was trying to get some time-sensitive work done off in a corner of the floor.  My manager is taught to screen such arrivals and phone calls, letting them know the owner doesn't take calls or in-store meetings and the best way to reach me was by e-mail.  However, this vendor spotted me and slid past the block, and interrupted my work to make his pitch.  So, colossally bad idea obviously.  At first I suppressed my autism recoil and answered, look, this is something we may look at eventually but we just moved and we're not in a position to add product lines any time soon, so no thanks.  I deliberately walked to a different part of the store and resumed work.  The guy apparently went to reengage and my manager stopped him with a stern "Don't."  Well, he heeded that warning and left his business card and a free sample shirt.  That exercise of good judgment is going to get him a return contact from me.  In 2018.  As opposed to never.

Second runner-up:
An entrepreneur more tone-deaf to today's business realities than most, has been sending a series of emails and messages pitching a Magic newsletter to stores for only $97 per month.  Not a typo.  Ninety-seven dollars.  And oh by the way there's already more community-generated Magic content than the world ever asked for, and in the social media age, a newsletter is quite possibly the most worthless means of delivering such content.  This isn't 1996.  Nobody is going to buy your 'zines, and rage against machines, you flagpole sitta.

First runner-up:
A vendor of statues and figurines called in and my manager mistook the call at first for a customer looking to sell us collectibles.  The caller was sufficiently vague that this was a legit engage on his part.  Anyway, once the guy made it clear he was a vendor, my manager deployed the screen block, explaining that I don't take calls or in-store meetings and he was welcome to e-mail me whatever he had.  The guy suddenly turned furious.  Cursed back at us, "such a bleep-bleeping waste of my time, thanks for nothing" and so on.  And now due to that vendor's discourteous treatment of my employee who was doing precisely what I taught him to do, I will never carry those products.

Most Unwelcome/Unprofessional Pitch:
I was at my desk and the store was busy so I took the call.  "Good evening, Desert Sky Games Chandler?"  A joking-sounded guy replied.  "Desert Sky?  So is this like an airline?"  He sounded a bit sarcastic but I gotta play it straight, I'm in the fun business after all.  "We're a game and comic store."  "So like video games?"  "Those too, but also tabletop games and card games."  "And you're called Desert Sky?"  So now I was getting annoyed, but I'm a pro at this, I kept it straight.  "That's us, what can I do for you?"  His response, naturally: "I need to talk to whoever is in charge of your merchant services and credit card processing..."

I really hope that call was recorded for quality and training purposes.

Tuesday, October 17, 2017


"A deed once done is done forever.  A task returns over and over again.  Some are doers of deeds; others are managers of tasks.  Few can master both." - Some Guy

It's a good thing I have staff who can master tasks, because tasks set my teeth on edge.  I am the quintessential doer of deeds, and naturally there are deeds stacked to the ceiling right now as the move has wrought an onslaught of work that has to be completed once and then stays completed.  It would be nice to spread these deeds out over the months and years to come, but of course that's not the way these things work, and if wishes were fishes, we'd all cast nets.

Since it's down to ceiling lights and then the play area can open, I have a bunch of deliverables upcoming that can't really start yet, much to my irritation.  Meaningful retrieval of assets from Tempe in our preparation to close that location can only happen as quickly as we can rack it in the compressed Chandler front room.  Once the game room does open, it will be a race against time to get the counter fixtures from Tempe so as to build the front counter down the length of the side of the store, since there aren't nearly enough showcases at Chandler to do the entire thing in advance.  I can't really deploy comics at all, aside from new and recent releases.  There isn't a place for them yet.

The top move, then, is to do as much work as possible that stays done after the consolidation of locations and the opening of the entire facility.  Product gondola racks are perfect.  These are being built the same way in every instance, I have the materials to make several more, and I will soon have the floor to deploy them and fill them with games.

I've got a couple hundred gridwall mounts and some eight-foot panels that will mount to the walls in the next week or so, which on one side of the store will accommodate sleeves and backcounter merch, and on the other side of the store will display new and recent issues of comics.  That will stay done as well.  And a ton of gorilla racks that are holding product now will stay built for use in housing additional singles and supplies later.

Got my security/network/AV hub built and situated.  Every workstation that has to exist is at least functional, though that won't finalize until the shipping room gets built, which is much later.  My crew took care of consolidating the gargantuan amount of cleaning and maintenance supplies that Gilbert had built up due to its horribly constrained space largely preventing us from centralizing those supplies in a functional commissary.

There is a lot of virtual work still to do, all the marketing materials and contact updates beyond those weekly distributors and vendors who already had to know and were updated as the move proceeded.  I'll be catching these and updating them for years to come.  Mail forwarding will stop after 90 days or 180 days or whenever it is, so hopefully all the crucial updates will be done by then.

I've been fighting exhaustion so this process has been slower than we wanted, but we'll get there.  It's not like I'm going to be moving the hub location any time soon.  Or ever, from today's outlook at least.

Tuesday, October 10, 2017

Mostly There

We were able to get the front area of the store and one restroom up to code on time to open them to the public, so there's a delightfully spooky passageway between the two zones and it's nicely in keeping with the Halloween season.  Meanwhile, the HVAC is finally fully online throughout the building, and we're down to needing overhead lights, ceiling tiles, and some miscellaneous hardware installation in the closed space, and then it can join the open space.

Construction isn't finished yet.  That's the way of things in commercial property.  It's done when it's done, and not until then.  I've made a habit of magnifying the delay, expense, and logistical difficulty that any construction is going to cause my business, and yet I still manage to undershoot the mark.  It's that bad even when it's better than par for the course.  Stores aren't wrong to seize opportunities to move into "finished" space even when that space is not optimal for the deployment.  The difference extends to more than cost savings, but also time savings.  You get to operate right away in full, with cash flow.

We prepared in advance for the cash flow irregularities we knew would accompany the move, and we did some borrowing in the end, and mostly we've weathered the storm fairly well.  It helped that our TCGPlayer Direct business basically never stopped.  We ran uninterrupted singles sales throughout the move and it wasn't storefront volume but it was a damned sight more than zero.  The Tempe location also stayed open and business as usual.  A store move where you're simply dead in the water for any length of time?  You shut your mouth, nobody needs to hear such horror stories.

The best part is that, when everything is finally open and the transition is long since paid for and our clientele has all found us again (and a huge portion of our clientele made the transition without a hitch), we will get literally years of enjoying the cost savings of a below-market lease rate and enough room to continue to grow operations without climbing up the walls.  It will be a little while before we're freerolling, but if we can reach the lease renewal point and continue in place, the sky is the limit.

I'm afraid that's about as much bloggery as I have ready right now, as the store punchlist is a mile long at this point even without the back-end space open.  So much to do.  We're going to Grand Open in November so it's early bird time right now, and I want this place looking awesome for the big unveiling.  Right now, it does not look awesome.

Tuesday, October 3, 2017

The Price of Open Doors

We made the move.  DSG Gilbert is entirely empty, and DSG Chandler stands in neonatal form, much of its merchandise and racking still not properly deployed on account of the game room still awaiting completion of construction.  As such, we had to do a Phase 1 deployment, to be followed by Phase 2 (completion of everything but the back room), and finally Phase 3 (all done).  As you might imagine, this is frustrating and slow and has built-in redundancy.  But we're open now.

Bottom line, DSG Chandler opened its doors to the public on September 29, 2017.  And there is a world of difference between being open and not being open, in terms of brand strength and optics and logistics, but especially sales.  People are buying things, sales are high for an opening frame, but less than what we'd have seen in place at Gilbert with our established draw.  I'm glad to see as much traffic as we are getting, with another few days still yet to wait for the sign company to move our marquee so people can even see us.

The worst part so far is the loss of sales from where we are not caught up.  Where the item someone wants is packed away in one of the many boxes scattered about the store and attempting to guess its location is laughable, and we have to tell the visitor their money's no good here.

Moving a card-focused shop is easy.  There's not a lot of live inventory on the floor, so if you can get to your singles and packs, you can basically operate.  TCGPlayer orders proceeded uninterrupted all week, so we had that moved and operational very rapidly.  Boxes of cards.  Take down off racks, move, put back up on racks, back in business.  Friday Night Magic drew three pods of drafters and a nice healthy raft of Magic sales.

The same is not true of other product categories, where if it's not merchandised properly on the floor, it's tough to sell anything.  Our regulars have been patient while we dug in boxes for a requested product here and there.  But even today my heart aches at each visitor who walks in, looks around at the almost nothing on the racks, and walks out, because I know we not only missed any sale, but also made a terrible brand impression.  We had a short window to move and that's a consequence I accept.

I should come in late, or early, and do some more setup.  But at my age, I no longer have the physical stamina to keep up with it.  I've moved homes something like ten times.  Moving a store is orders of magnitude worse than moving a home.  There are a lot more items that will only fit into a moving truck, and a lot more heavy or unwieldy items that were designed to be installed securely, safe from public damage, and largely not moved or adjusted in day-to-day use.  I had a staff and payroll and no sales coming in to support them, and insurance and tax issues precluded our use of volunteers, so largely it fell upon our own team to lug all the contents of the Gilbert store into a truck and back out again at Chandler, all by main strength.

By the second day, my back and legs were shot, my hands were cracking (despite gloves), my neck was sore, and each night I was collapsing into bed like a corpse.  I have kids, so of course I had to drive them to school at oh-dark-thirty every day before starting up the entire process again.  I can't remember a week in years when I more fervently needed a mulligan.  None was available.

Two days with the moving truck was barely enough.  Two large loads, each taking the better part of a day to deal with, followed by a day of sending small vehicles full of the remains back and forth ad nauseam while I coordinated with contractors and hurried to prep for what they needed.  Finally a walkthrough, which I only had to postpone once, and then passed.  Thus endeth the glory of Gilbert.  And assembly of the Chandler store ramped up with a vengeance.

Friday, we got our all-clear to open very late in the process but had people in immediately at that point.  There's a spooky and fun lamp-lit pathway through the darkness to the restroom in the back (the one that's up to code; the other needs tile work) and enough seating up front for maybe 32 players at most.  Griffin and Jake built us a batch of grid gondolas and we're starting to populate them, but on Friday it was a race against the clock to be ready for FNM.

Around mid-day Saturday, I hit the wall.  I just collapsed to my desk and could barely move.  I had to stay at the store, though, because our crew was already stretched to the limit in coverage and I was the only person who could run assorted spot logistics.  Moreover, we had to rebuild the store opening and closing procedure to account for the new facility.

It might have been nice to throw a pile of money at the move and just let the concierges do it.  But that wasn't in the cards.  Our budget only went so far.  Wounds heal, sleep renews, and we made it through the weekend.  After Sunday I was a little better rested, after Monday better still.  Even in my elderly decrepitude, recovery abounded.  Plenty of deliverables to muddle through in the weeks ahead, but they seem so much more achievable now with clear heads and strong hearts.

We are open.