Tuesday, January 29, 2019

Emulation and Piracy and Independent Video Game Stores

I wrote last year about the reasons I don't bother emulating or pirating software anymore, but I didn't really reach the issue of why emulation and software piracy is a dead end from the business perspective, even if the store does not actually provide any infringing content (though some do).

I hope I don't have to teach my store-owning readers to stay the hell away from software piracy in the first place, right?  Like, I realize there are some businesses out there that just don't get the message, and actually sell goods or services tailored toward infringement, such as a store to the northeast of me that is (at the time of this writing) so legitimate it has no real web presence other than just social media links and Craigslist ads.  They'll sell you a jailbroken Amazon Fire Stick and shrug their shoulders when Cox Cable cracks down on you, or so claim their customers at the above link.  And they aren't the only ones; a cursory search will lead you to local sources for bootleg XXXX-in-1 video game players, modified original Xboxes with thousands of ROMs installed, "reproduction" counterfeit game cartridges, and so on.

Nintendo notices piracy at scale, but won't likely do anything against private home usage.  As my earlier article noted, emulation isn't even the superior experience anymore, but I grant that for ultra-rare titles you'll never find in an arcade or never locate an authentic copy for a console, running a ROM in an emulator is excusable to some extent.  That excuse doesn't wash for the vast majority of emulation usage, which is to play ultra-common content like Super Mario Bros or Castlevania, of course.  And let's be honest, nobody is going to use emulators just to play public domain (PD) ROMs or homebrew ROMs.  That has never been more than an ultra-niche use scenario.  And the "archival backup" fair-use exception to infringement is narrower than people realize.

But even if your video game store isn't going to come within ten miles of a ROM, it is still highly inadvisable to have anything to do with emulation, even tangentially enabling.  And I am making this argument purely on practical business grounds.  Look here.

The realistic realm of products that we could carry that cater to emulation are: USB "clone" controllers, Raspberry Pi hardware and related merch, and "MAME controller kits" -- basically arcade parts and kits that allow users to assemble them for ease of adaptation to emulation usage.

Each of those three has a fringe commercial application, and each of them has a fatal flaw that makes it worth staying away.

The USB clone controllers are the closest things to some veneer of legitimacy.  They are actual controllers, and you can use them on actual consoles that use USB controllers, or on Steam or Windows or MacOS, or what have you.  Some are shaped a lot like Nintendo 64 controllers or Gamecube controllers or others, and that may well be patent violating, but it's not the end user's problem when that happens.  It's up to Customs to stop imports when applicable.  I can entertain an argument that someone playing Axiom Verge on a PC might prefer the feel of a SNES-style USB controller for doing so.  And heck, wired controllers for the current generation of consoles (Switch, Xbox One, and Playstation 4) are all USB controllers, but are overwhelmingly acquired for use with their intended hardware platforms.

But let's be honest, the main reason to use a USB facsimile of the N64 Batarang is for verisimilitude when emulating that console and others like it.  Thus, the primary audience for such a controller is a gamer you don't want to cater to anyway.  We know this by understanding what he's not, and applying the process of elimination:

  • He's not a purist, because a purist would play N64 games on a real Nintendo 64, and would use a real Nintendo 64 controller.  
  • He's not a competitive gamer, because that gamer will use a real N64 with a CRT to avoid lag and a Smash stick modification to a real N64 controller, or a rare authentic Hori.  
  • He's not a collector, because the clone USB controllers have no aftermarket value.  
  • And he's not a casual gamer or parent buying for their kid to play; they generally won't set up an emulation rig in front of Junior (or at all).  They will buy used cartridges, or buy a digital download from the Virtual Console or Playstation Network or Xbox Live or Steam or the App Store or wherever their game is offered.  (Nintendo's first-party games won't appear on most of those other platforms, but publishers like Capcom, EA, Activision, Konami, and Sega are all over the place.)  

No, at the end of the day, the person who wants that USB controller is a gamer who goes out of his way to avoid paying for games.  A video game store can serve, in one way or another, a purist, a competitor, a collector, a casual, and a parent.  There's not much of a business case for serving a gamer who, by definition, doesn't want to have to buy anything.  And even if everything goes perfectly and you make that sale to that gamer, you know good and well they're never buying anything else.  That makes the product less attractive for us than products that lead people to further engagement, whether video games or tabletop.  We could have been serving a better customer, to put it bluntly, with that time and inventory budget.

What about the Raspberry Pi and related items?  It's all commodity hardware, so margins are going to be questionable, and commodity hardware is not the business we're in anyway, and to the extent that it overlaps into our business, it's the worst end of what a Pi could be used for (from our vantage point).  I can even be charitable and say that your typical Pi user might be very conscientious about legality and have no intention of infringing emulation (a supposition not supported in reality, but just suppose).  And that would leave us with that user as a hobbyist, and if we've learned one thing in this trade, it's that the hobbyist customer is typically far deeper into their niche of the market than what a local physical retail store is going to serve.  They scarcely have need of any store selling most Pi stuff; for their particular project they need 3-D printed custom assembly elements, customized code, and so on.  They dwell in /r/raspberry_pi and they delve deep as a Moria dwarf.  For the same reason most Warhammer stores don't stock a ton of Forge World, and most Magic stores don't offer alters on demand, and most board game stores don't spread an aisle full of Broken Token, most video game stores are smartest to leave Raspberry Pi alone.

Finally, MAME controller kits.  I will entertain an argument that arcade parts generally are a fine thing to sell, in that they are typically produced legitimately, and there exists real demand among arcade collectors for such parts.  Of course, once again, if you're running a video game store, you're not necessarily running an arcade video game store, because that market has a vastly different scope of needs.  It's fundamentally a hobby for geezers like me who buy antique electronics and restore them.  Actual controller parts end up being something of an afterthought, since a given cabinet only really needs to have the control panel fixed or rebuilt once, and the parts are dirt cheap straight from China or from the handful of existing focused resellers.  Instead, most days we're buying soldering supplies or electrical parts or carpentry stuff for working on the cabinet exteriors.  And that's without even pushing into the realm of pinball!

And oh, man, if you thought software pirates didn't want to pay for things, you haven't begun to interact with arcade collectors.  You'll never meet a bigger bunch of cheapskates.  These are guys who are used to getting things for free or next-to-free, often from the scrap heap.  They all haggle like their lives depend on it, simply for the ability to brag later about how little they paid for their "finds."  (Naturally, when they go to resell, their collection is suddenly valuable.)  These are the guys who literally will order online to save fifty cents on an $87 part because they don't care if it takes a week for the part to arrive in the mail.  They've been working on that dead Tempest in their garage for a few hours a week for the last three years, what do a few more days matter?

Suffice it to say most video game stores are unlikely to stock in breadth, and at prices attractive to the target audience, a viable inventory of arcade supplies.   That is, again, unless the plan is to cater to people building MAME boxes to run pirated arcade ROMs, because they will be unfamiliar with the economy of the arcade aftermarket, and will grudgingly pay some amount to get their box built so they can enjoy those thousands of illicitly acquired games.  So at that point you're kind of stretching the limits of plausible deniability, and you've also circled back to the problem of offering a product intended for an audience that doesn't want to pay for its video games.

At least the crusty old arcade collectors tend to be purists who want authentic hardware with real vintage market value, and their supply purchases are purpose-neutral to the likes of Mouser, Home Depot, Fry's Electronics, and the other vendors they utilize.  Not the case with emulation until you really squint and ignore that smell.  You've got an adjacent theory?  Maybe you run fighting game tournaments and you have a customer base who wants to build their own fight sticks?  Yeah, save it for the deposition.  The prospects are fatally marginal beyond what saturates the totality of the worldwide market for this stuff... and that market space is closed out already.

Ultimately, it is bad business to go to these lengths to bend over dollars to pick up dimes.  It is worse still to do it knowing the publishers despise it.  Suppose your video game store has developed to where you're getting substantial quantities of new front-list product day-and-date from the likes of Nintendo, Sony, Microsoft, Square Enix, Bethesda, EA, and so on.  I don't deal in new first-party merch for now because margins are tighter than I'd like, but suppose you're positioned in the market where it makes sense for you to do it.  How do you think those publishers are going to react when they get a tattle screenshot emailed from your competitor showing them that you cater to the emulation market, even indirectly?  Do you suppose that makes Nintendo eager to continue a business partnership with you?  They don't need independent stores, they get all the volume they want in the mass market.  Hot titles and consoles come out and we wish we could get enough to meet the demand of the phone calls and message inquiries that bombard us at release time.  If you carry Magic: the Gathering, would you sell supplies for making proxies and expect Wizards of the Coast to be in a supportive frame of mind?  Get real.

There it is.  Emulation and piracy are realities, they aren't going away for at least the time being, and though I've made the argument (link at start of article) that they aren't even as useful anymore as just paying for legitimate options, I know there are people who will continue to emulate for the purpose of playing pirated software.  If you run a game store, you have no excuse: You should now be able to recognize the necessity for your business to steer clear.  You want to screw around with it on your own time at home, who cares, be my guest, knock yourself out.  But keep it away from your business, your livelihood.

We are in a boom cycle for retro video game collecting and playing, thanks to a combination of great throwback products, inexpensive access to retro titles both via cloudware and physical console media, streamers and YouTubers plumbing the depths of yesterday's hidden gems, and high market efficiency made possible by mature e-commerce channels and maturing social media channels.  Jump on board the legitimate money train and don't waste your time with the pirate ships moored down at the docks.

Tuesday, January 22, 2019

New Store Owner Customer Inquiry Translations

Congratulations!  Your brand new comic and/or hobby game store is up and running!

Permit Hell is finally over, the signs are up and the lights are on, and your soft opening went smoothly.  Over $500 in sales on day one, and almost two grand in your first week!

Now you're running your introductory events, spicing up the pot a bit with slightly aggressive extra prizing.  Not so much that your brand-new customer base will be angry when you walk it back, you hope.  But enough to make nearby incumbent stores look greedy for running their events at break-even.

Your suite still smells like paint and IKEA pressboard, and your restroom is gloriously clean.  Elaborate price labels appear above every barcode on your merch.

Your store rating is a smooth 5.0 on Facebook, Google, and Yelp, thanks to your spouse and their friends.

The store's bank account is flush with your entry capital, and you're safe to put in ambitious orders.  Your stockist assortment just showed up from Games Workshop, and the invoice on that ain't due for months.  And with a little extra marketing push, you should hit Core in time to sanction the War of the Spark prerelease.

Sure enough, everything is looking great for your new business.  As NBN would say, The World Is Yours.*  Best of luck, and go get 'em.

...

What?

Oh, that asterisk?  It's nothing, I wouldn't worry about it.

No, I said it's nothing.  Forget I ever punctuated it.  The World Is Yours.  There.  Feel better?

Seriously, it's fine.

(deep breath)

Okay.  The thing is this.  You are about to start getting customer inquiries, and there's a certain subtext that's kind of lost in translation until you become fully fluent in the language.  Fully proficient in the parlance of our trade, if you will.

Until that happens, you're going to hear what the customers are asking, and you're going to give the "ultimate perfect customer service" answer, and you're going to back that up with action, which is going to mean spending resources.  And the thing is, it's totally not going to have the result you expect.

And the reason for that is that a seemingly innocuous question almost always has a tip-off of some kind, a subtle indicator of what's really being asked.  And you'll miss that subtext.  And the payload in that subtext is where you lose money.  Sometimes lots of it quickly, sometimes the death of a thousand cuts.  Bottom line, you're gonna get rolled.

What do I mean?

Look, I only have so much time here.  I have tax preparation to do.  You won't have to worry about that until next spring.  But to show you my heart is in the right place, I'll translate these first few communiqués for you, and you'll learn the rest as you go.

Ready?

Customer asks: Brand new specialty store, looks great! Which credit cards do you accept?

Customer means: Will you sign up for merchant services through my commission account?

Customer asks: Awesome, a new comic shop!  Do you carry indie comics, like, locally-produced books?

Customer means: Will you buy my self-published indie comic book?  It's about a comic writer and artist who lives in a grubby apartment and makes edgy observations about life and sexuality.  It stars all my friends.

Customer asks: Sweet, a new store!  Do you guys sell Yu-Gi-Oh cards?

Customer means: Will you overpay me for my years-old, beaten-up Yu-Gi-Oh cards?  I need cash to buy vape cartridges.

Customer asks: Hey, a new store.  Will you guys run Yu-Gi-Oh tournaments?

Customer means: I was banned from the other YGO store in town for shoplifting.  You have lots of nice stuff on the shelves, by the way.

Customer asks: Glad to see another new store.  Will you guys run Vanguard tournaments? (or any anime TCG)

Customer means: I buy my booster boxes at a nickel over bottom wholesale online, but I need a place to play and people to play against.  I will never spend one cent in your store that I am not required to spend to play the game.  I have a lolicon playmat that younger customers shouldn't see, but will.

Customer asks: Finally, a new minis store! Are you guys going to support Firestorm Armada? (or any fringe wargame)

Customer means: I bought $730 worth of fleet/army from Miniature Market, but nobody around here plays.  I need you to train playmates for me and bring in product to sell them, but not to me, I already have mine.  The other wargames/minis stores in town already figured this out, which is why they won't stock my fringe wargame.

Customer asks: Awesome, a new comic store. Do you buy old-school vintage rare valuable Pokemon cards?

Customer means: I found my Ash binder from 20 years ago and I'm late on my mortgage payment.  These Machamps should be good for a grand apiece.  They're 1st Edition.

Customer asks: Wow, a new tabletop store, huh?  Are you going to stock [Kickstarter Trash of the Month Week Day]?

Customer means: I'm hoping there's some way I can still get the exclusive backer limited edition at a discount, since I was too late to back it before the cutoff.  I don't want the retail edition, that's leprosy.  Paradoxically, I'll never play this game, or I'll play it only once before the next shiny title launches its crowdfunding campaign, and this one will go on my shelf for all eternity.

Customer asks: Hey, a new game store! Do you have any copies of Big Chungus for the PS4 in stock?  It's for my grandson.

Customer means: I am incapable of original thought.

Customer asks: Sweet, a new card shop. What's your buy rate on Magic bulk?  Is it more if it's sorted?

Customer means: I am a backpack dealer and this stuff is picked as clean as an animal skeleton in the desert.  The established Magic stores in town already stopped buying bulk from me.

Customer asks: You guys do board games? Do you have this Fantasy Flight board game, or can you special order it for me?

Customer means: Amazon has it at double MSRP and I want to flip it.  It's between printings, but I am hoping you don't know that or understand how it works.  If by some miracle you have it on the shelf at MSRP, I will actually attempt to haggle you down further below the spiking market price, because I'm already winning, so I may as well go for the throat.

Customer asks: What percentage of entry fees is your prize payout? (v1)

Customer means: I was banned from the other store in town that reliably fires eternal formats.

Customer asks: What percentage of entry fees is your prize payout? (v2)

Customer means: If it's one cent less than the store I'm at now, you'll never see me again, but I will reply on local Facebook Magic player groups every time someone asks about your store by telling them you are a gouger and never to buy here.  If it's one cent more, I will be here every day grinding, chasing casuals away, haranguing you to fire events with five or six players at full prizing so I can win easily, and on social media I'll complain about your price gouging on boxes.  Boxes should never cost more than "85$."

Customer asks: What percentage of entry fees is your prize payout? (v3)

Customer means: My brother-in-law owns the clubhouse store eight miles away that you opened against, and we need to make sure we publicly undercut you in response to your grand opening tournament announcement.  We will punctuate that by selling boxes "while supplies last" for "80$" (there are three boxes available under this "sick deal" but we will keep that quiet) and we'll make sure the town loudmouth buys the first one and give him a free soda to post his glowing reaction on social media immediately.  Hope you're ready for a race to the bottom.

Customer asks: Oh hey there you got games. How much cash could I get for some brand new PS4 controllers, still in the box?

Customer means: I stole these from Wal-Mart and they won't take them at GameStop because they know better.

Ten customers ask: You sell board games? Can you get a copy of Unobtainable Hot Boardgame when it comes back into print for me?

Ten customers mean: Each of us are calling every store and asking this.  Demand seems like it's for hundreds of copies, ten or so for every store in town.  In fact, real demand is only a handful of copies, perhaps fewer as some of us are friends and can share a copy.  You will restock many copies when you should restock one, or possibly zero.  Once it's in stock at Amazon, that's where we're going to get it anyway.  You will have ten unsellable copies gathering dust on the shelf.




Tuesday, January 8, 2019

Hobby Comic and Game Store Closures, Second Half of 2018

It is still a bloodbath out there, just as it was for late 2017 and early 2018.

Here are the stores that hung it up between July 1, 2018 and December 31, 2018, that I know about. My information sources are imperfect but I am confident that this list does not fundamentally mischaracterize the situation. I required a firsthand-source announcement or evidence of the discovery of the store closed in order to add it to the list.

Announced or Discovered Closed: 

  1. Alamo City Comics (San Antonio, TX) 
  2. Alpha Games (Chilliwack, BC, Canada) 
  3. Alter Ego Comics and Collectibles (Bellevue, WA) 
  4. Apex Hobby Shop (La Crosse, WI) other location in Sparta, WI closing early 2019
  5. Babbitt's Books & Games (Normal, IL) 
  6. Battlequest (Carfax, Horsham, UK) 
  7. BattleZone Comics & Games (Las Vegas, NV) 
  8. Big Kidz Games (Grand Rapids, MI) 
  9. Black Dog Hobby and Game (Loves Park, IL) 
  10. Black Rooster Gaming (Champaign, IL) 
  11. Buy-Back Games (Wheat Ridge, CO) 
  12. Byte Club Gaming (Pentwater, MI) 
  13. Capital City's Game Emporium (Jefferson City, MO)
  14. Cheese Boy Comics (Las Vegas, NV) 
  15. Coffee & Dice (Bournemouth, UK) 
  16. Comic Emporium (Panama City, FL) 
  17. Comics FTW (Santa Rosa, CA) 
  18. Costales' Dungeons & Flagons (Fresno, CA) 
  19. Crazy Timmy Games (Kirkland, WA) 
  20. Crossroads Games & Comics (Victoria, VA) 
  21. Ctrl-Alt-Delete Gaming (Sheffield, OH) 
  22. Double Dragon Gaming (Waterloo, IA) 
  23. Draxtar Games (Batavia, IL) 
  24. Eccentric Emporium Video Games and Collectibles (Kissimmee, FL) 
  25. Evolution Games (Wilkes-Barre, PA), may be reopening 
  26. Forge 26 (Halifax, West Yorkshire, UK) 
  27. Funtastic Games (Louisville, CO) 
  28. The Game Cave (Hendersonville, TN) 
  29. Gameporium (Seattle, WA) 
  30. Gamers (4 locations in Omana, NE and nearby) 
  31. Gamerz Planet (Grand Junction, CO) 
  32. GameSpace (St. Mary's, ON, Canada) 
  33. Game Time Miniatures (Milford, OH) 
  34. Gathering Games (Tampa, FL) 
  35. Get Your Game On (Ann Arbor, MI) 
  36. Good Games Montana (Butte, MT) 
  37. Goose's Gaming (Milan, TN) location in McKenzie, TN remains open
  38. Hazely's Realm LLC (Grandview, WA) 
  39. Hobby Town (Auburn, AL) 
  40. Hobby Town (Lake Geneva, WI) - birthplace of D&D 
  41. Imperium Games (Wixom, MI)
  42. Iscevari Marketplace (Owatonna, MN) 
  43. Kitsilano Comicshop (Vancouver, BC, Canada) 
  44. KnK Gaming (Myrtle Beach, SC) 
  45. Lauderdale Comics (Fort Lauderdale, FL)
  46. Legacy Defined Games (Killeen, TX) 
  47. Let's Play Games and Comics (Waverly, NY) 
  48. Mac's Comics & Collectibles Inc (Miami, FL)
  49. Mile High Comics (Glendale, CO) Warehouse location remains open 
  50. Monster Comic Books (Tempe, AZ) Later reopened under new ownership
  51. Movie House (McCook, NE) 
  52. Myriad Games (Londonderry, NH) 
  53. My Secret Identity Comics and Games (Sydney, NS, Canada) 
  54. The Nerd Store (Mt Morris, NY) 
  55. Nexgen Next Level Gaming (Horn Lake, MS) 
  56. Outlaw Gamers (Golden Valley, AZ) 
  57. Packard's/McGuire Books (Oak Ridge, TN) 
  58. Phantasy Hobbies (Shakopee, MN) 
  59. PT Collectibles (Edison, NJ) 
  60. Respawn Gaming (Beaumont, TX) 
  61. RetroFix (Great Falls, MT) - Missoula location remains open 
  62. Revolution Games (Calgary, AB, Canada) 
  63. Rewind Collectables & Games (Ashton-under-Lyme, Lancashire, UK) 
  64. Shadow Games LTD (Rugby, Warwickshire, UK) 
  65. Silver Gym Games (Arlington, TX)
  66. Silver Wolf Comics and Games (Morgan City, LA)
  67. Sockmonkey Junction (Mansfield, TX) 
  68. Southern Fried Comics (Hattiesburg, MS) 
  69. Stage 2 Games (Cabot, AR) 
  70. Sword & Board (Exeter, UK) 
  71. TCG Junkie (Las Vegas, NV) 
  72. Toyriffic (Hudson, WI) 
  73. Valkyrie Cards and Games (Vancouver, WA)
  74. Video Game Galaxy (Orange City, FL) other location remains open 
  75. Vigilante Games (Warner Robins, GA) 
  76. Villains Unlimited Comics and Games (Miami, FL)
  77. White Cap Comics and Games (Grand Rapids, MI) 
  78. Xaos Games (Gateshead, UK) 


After posting these articles I typically receive a flurry of additional store closure info, so I figure I should also publish the ones we know about that didn't close just yet but already announced that they're done, so well-meaning folks know they don't have to send those in.  Here:

Stores announced closing the 1st half of 2019:

  1. Apex Hobby Shop (Sparta, WI) Other location closed late 2018
  2. BC Comix (Howell, MI) One huge location built from 3 smaller locations, all closed 
  3. Endgame (Oakland, CA) 
  4. GameXcape (Asheville, NC) 
  5. Playthings (Madison, WI) 
  6. R.U. Game? (Brandon, FL) 2 other Tampa area locations remain open 
  7. Sixth Chamber Used Books (St Paul, MN) 
  8. We Know Video Games (Albuquerque, NM) 3 locations all closing 
  9. Wizard's Tower (Stuart, FL) complete with raucous Vegas bender


So, the list grows again.  Fifty stores, then 59, now 69 (dude!) when this post first went up and increasing as I add more from edits, and you have to extrapolate that I probably know about maybe 10% of the real closures, most are anonymous holes-in-the-wall in Nowheresville, West Carolina, so the real number is probably 700+.

How many will close in the first half of 2019? With the main revenue line for most comic and hobby game stores in a state of extreme market upheaval despite generally excellent content -- Magic: the Gathering, of course -- there are a fair number of stores that simply have nothing else to turn to.  The flip side of that, as I have alluded in recent posts, is that a store that focused on nothing but Magic for at least the past four years or so is probably in a pretty stable position, and can at least ride a toboggan safely to their lease terminus.

(Photo posted on Alter Ego Comics public feed.)

Something I want to emphasize again is that a store closure should not be assumed reflective of ignorance, incompetence, or laziness on the part of the owner(s).  Though that does happen probably more often than it ought.  The reality is, the deck is stacked against small businesses in America (and even in Canada and the UK, as you can see in the list).  Virtually every imposed cost hits with no economy of scale to absorb or mitigate it.  Virtually every loss ends up at the feet of the ownership, who get paid last.  Virtually every entitlement takes away the next dollar and there's no way to be sure where the dollar after that will come from.  I mean we kind of know, but until you have it, you never really know.  Every day I wonder if that's the day that the general public will make an irrevocable turn away from every niche product line I happen to carry.  Sales don't have to go to zero overnight to kill off a lot of businesses.  In fact, in a heated bubble market, a simple slowdown of the growth rate might be enough.

I've spent the last six years pouring my every effort into making Desert Sky Games the best it can be, and I've seen peers working every bit as hard who caught a few worse breaks and they don't have stores anymore.  I've seen people who stuck it out and survived long-ago downturns weathering the current turbulence with aplomb and a healthy reserve; I've seen people whose stores did fine during the last famine run out of gas this time and have no back-pocket solution to call upon.  I've seen people with no business running stores have Brewster's Millions scenarios allowing them to piss away untold fortunes paying area grinders to love them temporarily.  I've seen people with no business running stores get roped into "investments" by fast-talking turn-key hucksters, both on the tabletop side and the video game side of the swimming pool.

And I've seen two new stores arise for each one that closes, which is why these lists will never really end.

DSG is still for sale and always will be until I've handed over the keys, but nobody who can afford it wants it, and nobody who wants it can afford it.  Guess I'll get up in the morning tomorrow and spend another day trying to raise my game.

Tuesday, January 1, 2019

Turning Lessons into Action in 2019

Did you miss me?  Things got busy.  I definitely did not have the luxury of writing for the past couple of weeks.

I intimated last time out that I had clarity on some things.  There are going to be some DSG adjustments and the first one is in process now.  The market has spoken, and when it buys tabletop products from me, it mostly does so from my fulfillment channels on Amazon and eBay.  In store, not so much.

In-store, Magic is the absolute king.  It is the #1 category in store by sales and its subcategories make up six of the top ten subs.  Three others in that top ten are video games, which together are the #2 category.  The other category to place one sub in the top ten is Dungeons & Dragons.  Board games and miniatures both missed.  In 2018 they missed badly.

In smaller communities, hybrid stores with good processes can be in a lucrative business position.  Increasingly I am concluding from observations that in major metro areas, a store has to commit hard to a narrower range of things.  I can carry anything in my store that I can source, but if I want to make any kind of real money on it, I need to dominate that category.  I need to at least be attempting to be the top source in town.  If we are that, we get a huge audience; people drive past competitors to come to us first.  If we miss, we're still the top choice for miles in any direction, and overwhelm any new competitors.  So we'll never stop pushing Magic to get bigger and better, and while we're at it, a lot of resources right now are going to go into building the video game category into a crushing force.
Where will I get those resources?  Largely from online liquidation of most of my existing stock of board games and Warhammer.  My romantic notion of being all things for all people has me clinging to those categories as a "one day," so rather than just dropping them, I am going to put both into "offseason mode" like I did for board games for the first three quarters in 2018.  Since my end-of-year blowouts still failed to move the bulk of my stock in those categories -- and we're talking about below-MAP pricing across the board, and most board games in the 50% discount range -- I have a pile of giant distributor boxes full of titles that will be headed to Amazon fulfillment this week.

Isn't the offseason-mode plan costing me sales, you might reasonably ask?  I'm sure there are some, and I'm not sure it's a lot.  It's impossible to know which sales a store is really missing, but we know month in and month out that most requests are for "common" titles, and fewer requests come in except in December for deeper catalog titles, relatively speaking.  Moreover, whatever tabletop games do come out during the offseason tend to end up on the clearance rack before long.  Was there any new evergreen in 2018 other than Discover Lands Unknown?  Will that game actually be an evergreen like it appears so far?  Nobody knows!  What I do know is we sold plenty of Catan and Dice Forge and Concept and Dixit and Agricola and Azul and Exit and silly party games.  And you don't have to be wall-to-wall board games like Glendale's magnificent Imperial Outpost or even my northern neighbors in Tempe, the Game Depot, to make those sales.  Those sales are low-hanging fruit and they suit my diet just fine.  I'll let stores like those two cover the deep end of the pool for tabletop, as they've been doing.

Out with the old, in with the nucleus, as cartoon science professors are wont to say.  I will be adding two new categories to the store that I'm already overlapping into, and I have some outstanding sourcing and infrastructure for them, so I expect to run strong very quickly with them, in keeping with the concepts discussed above.  One of these new categories will appear later in January.  The other will appear around April or May, depending on how some parts of the project play out.

A consequence of these adjustments is that the game room configuration needs to change, because a bunch of the rest of the store needs to reconfigure for functional purposes.  The TCG capacity will grow back to its prerelease levels after I finish with a temporary closure of about a quarter of the game room.  Minis are going to be down at least one table.  I know this will worry some of my minis players, but the reality is those tables are rarely used anymore.  D&D was already down a table because so many of the groups disrupt the room arrangement and don't put it back, and we had it set exactly to how it needed to be to gain that last table... and I don't have time in the day to be manually resetting it every time they decide to be inconsiderate, so we'll be down one table in order that I can sleep without worrying about fire code compliance.

Anyway now I've devolved from concept content into my honey-do list as usual, so I'll leave it at that and wish you all a great start to your 2019, the Year of the New Ori Game!