GW comments on changes to European trading terms

By tgn_admin
In News
May 22nd, 2011
128 Comments
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Games Workshop CEO Mark Wells has posted a public response to criticisms regarding their changes to European trade conditions.

From their website:

Dear Hobbyists,

Thanks for contacting Games Workshop about the change in our trading terms for European accounts. I know this has frustrated you and for that I am truly sorry. As a long standing customer, you deserve to know why we made this decision.

As you know, we introduce people to the Games Workshop hobby of collecting, painting and gaming with Citadel miniatures through our Hobby Centres and local independent trade accounts. Games Workshop Hobby Centres run introductory games and painting sessions, beginner lessons, hobby activities and events. We provide all these services free of charge. We only recover this investment if customers then buy products from us.

Where we don’t have a Games Workshop Hobby Centre, we support local independent trade accounts. These businesses provide a convenient place for customers to buy our products close to where they live. We support these businesses with local customer service teams and warehouses to ensure customers have immediate access to our best selling products and new releases. Many customers discover the hobby this way.

In addition we invest millions of pounds every year in our design studio and factory to ensure that each month we release more new products. This makes the Games Workshop Hobby more exciting for existing customers, helping them stay in the hobby longer. We can only afford to do this because of the volume of customers we have recruited and developed through our local Hobby Centres and trade accounts.

It is for this reason that we have changed our European Trade terms. Over recent years, a number of currencies have moved a long way from their historical relative values, and this has opened the door for some traders to try to take advantage of these currency movements and offer deep discounts to overseas hobbyists. This has been the case with European internet traders selling to some of our customers overseas.

While this may seem great in the short term, the simple fact is that European internet traders will not invest any money in growing the hobby in your country. Their model is to minimise their costs and free-ride on the investment of Games Workshop and local independent shops in creating a customer base.

The inevitable consequence if this was allowed to continue is that Games Workshop would not be able to operate Hobby Centres, nor to support local trade accounts. And if this happened in more territories outside Europe, the loss of volume would leave Games Workshop no choice but to scale back our investment in new product development, further eroding our customer base. Not something that we or our customers would want us to do.

That is why we took the decision to take legitimate action to restrict European trade accounts from selling the goods they purchase from Games Workshop outside Europe.

While I understand that you may still be unhappy with our decision, it was taken to ensure we can continue to support the Games Workshop hobby communities around the world through our Games Workshop Hobby Centres and local trade accounts. And to ensure we continue to invest in developing the best possible new product releases every month. I hope therefore that over time you will see the benefits of this decision for you and your hobby.

Yours sincerely,

Mark Wells
Chief Executive
18 May 2011

  • theriveter

    This is a fancy way for GW to say: “Our retail stores are hurting, waaaaaaaaah!”

    Well, i remember being at my local game store when the fallout from Games Workshop’s “sell $3k a month in our product or lose your ability to buy direct from us” marketing strategy went into effect in the early 2000’s. The owner told your rep where he could stick it, then he invested heavily in two new-ish games, Confrontation (R.I.P) and Warmachine.

    Then GW mysteriously decides to open a GW store in the middle of the Southern California gaming area where several shops could no longer sell their product, which drives the other stores out of selling 3k of GW a month.

    These stores could still sell GW products it they wanted to, but their profit margin was next to nothing. This and the above statement are prime examples of how GW has turned into a band of self-aggrandizing profiteers.

    GW routinely takes an aggressive stance with their local trade outlets, this is nothing new.

    They are trying to protect sliding sales in their all-to-important “Hobby Centers” instead of focusing on what is important: Their customers.

    This combined with the recent “change to cheaper production materials = price hike on ALL products” move just seems financially suicidal. Whoever is making these decision over at GW needs to look up the definition of the word hubris. And then send i large gift basket with a “You’re welcome” card attached over the Privateer Press. They basically just forfeited their market share to them. Thank the Gods.

  • Daniel36

    I find it funny that he is thanking us for contacting them when I for the life of me cannot find any contact information on their site or anywhere else to voice any concerns… Or am I just an idiot?

    • Zac

      They have a customer service contact page on their site that includes an email address. A lot of people have been sending comments to that address

      • PanzerKraken

        They also have their facebook page which had said they heard all the complaints and were forwarding it to the appropriate people… supposedly.

  • General Hobbs

    I’ve worked in the toy soldier/gaming business for several companies. The vast majority of game store owners are complete retards when it comes to knowing how to run a store and run a business. This frustrates the gaming companies, so thats why a company like GW sets a store up in an area. You keep telling the store owner what they need to do, they don’t do it, so they go out of business.

    Back in 2000, sales figures for GW showed that when they opened a hobby center near a game store, the influx of new recruits made by the GW store led to higher sales for the game store, as people would prefer to game at a game store than a GW store.

    Why is it wrong for GW to make a profit on their goods? There seems to be this mentality that GW owes its customers something….cheap figures, free books etc.

    Privateer Press is just as expensive to get into and play as GW is. If anything, GW plastics are cheaper than anything PP has out. And not everyone likes PP’s rules or figures. They won’t be getting my money.

    From working in a gamestore I can say this….Gamers are cheap and selfish. The store owner would have a tournament and offer good prizes, and the gamers would buy off an internet discount store and not give the local store their money…so when the store owner realized this and stopped having tournaments, they cussed him out.

    I do agree that the whole make products out of cheaper materials and raise prices is ridiculous. A manager tried to convince me that you are paying for the quality of the sculpt and figure, not the materials the figure is made of. I pointed out that Ragnar Blackmane is over 10 years old and is a shoddy sculpt, no matter what the material, so why pay over 15 dollars for him?

    • Zac

      The vast majority of game store owners are complete retards…

      Lets keep the defamatory language and generalizations to a minimum.

      Given that all the current store owners still in business have survived a massive world-wide recession I suspect that they might have a touch more business acumen that you are giving them credit for.

      Gamers are cheap and selfish

      Gamers are motivated by a desire to maximize their hobby returns per dollar as much as any consumer is.

      Its sad to say that some gamers are not interested in supporting their local stores but again generalizations don’t help promote debate.

      It has to be said though that GW is more prone to this sort of online buying behaviour. Whether that is due to its popularity or just that the prices for GW products are so much higher

      Back in 2000, sales figures for GW showed that when they opened a hobby center near a game store, the influx of new recruits made by the GW store led to higher sales for the game store, as people would prefer to game at a game store than a GW store.

      Those are wonderfully self-serving statistics for them to post 🙂 Do you have a reference?

      • General Hobbs

        Alot of the game stores are given credit from the game companies. Many of them are operating in the red. The game companies accept small payments so the store can stay open and continue to order product. You’d be surprised at how badly some of the more “successful” game stores are really doing.

        You conveniently did not address my example of how gamers are cheap and selfish heh.

        • Psychotic Storm

          Why should he? gamers are consumers and as consumers try to get the best value for their money, if the locals cannot provide it they will go elsewhere.

          Calling that cheap and selfish? since when the customer owns the shop anything?

          • General Hobbs

            Sighs…..

            Did you read everything? Local guy opens up a gaming store. He sells GW, has tables, runs tournaments and events.

            Because he has to pay rent and salaries, he can’t offer a discount, or offers only a small one. Online retailers offer larger discounts with free shipping.

            Local gamers support the online retailer. The local store goes out of business.

            Local gamers no longer have a place to play or have tournements at. Sure, there’s always someone’s basement or garage, but no stores to sell or recruit new players = death of the hobby.

          • General Hobbs

            That is why gamers are selfish. I’ve seen gamers thrown down paper cups and army figures to represent drop pods and terminators….

          • scottjm

            So then the only reason all other games exist is because there are B&M stores to promote, sell & support their products? Not likely. I think word of mouth and the net play a much larger part than you think.

          • Psychotic Storm

            Sorry I do not support your view, my entering in the hobby of wargaming was at a really early age when Internet was not available in my country and when there were only a few independent stores in my country one of which had a table in the attic available only to the selected few who were so awesome to be allowed in there to play, suffice to say youngsters like me and quite a few others were not allowed.

            And this went on for a decade, guess what? the hobby community build up strength, just by playing in other peoples houses god knows how strong it could have been if we had formed clubs back then.

            I honestly couldn’t care less for the local stores if they cannot compete they do somethign wrong, the online retailer does somethign good and there is nothing preventing any local shop to do what a big online discounter does, why are they that much better than the local shop.

            If nothing else the online discounter has to fight the fact he gets no impulse/ instant gratification sales because of the fact he ships the product to the customer.

            If the local shop has tables, scenery is well stocked and has competing prices, it will always win over the online retailer because of all this added value it has.

          • I have never been recruited into any aspect of the hobby by a shop. My peer group does that. We game at clubs and provide our own premises. We do not need wargame shops, the internet and going to a show provide all the gaming kit we need.
            If shops provide facilities for gamers they should charge for them and thus get the value they are providing in cash, not good wishes.

          • Psychotic Storm

            If shops provide facilities for gamers they should charge for them and thus get the value they are providing in cash, not good wishes.

            That never really worked around here, actually the only time it did work and worked well was when a shop opened a club, not closely associated with the shop, that worked and got subscriptions.

          • Zac

            That never really worked around here

            Never seen it work anywhere to be honest

          • In that case, not worth doing.

          • Zac

            If nothing else the online discounter has to fight the fact he gets no impulse/ instant gratification sales because of the fact he ships the product to the customer.

            I don’t think that is the case. Perhaps when it comes to GW games but I went into my FLGS on Saturday and walked away with way too much Spartan Games product but not any of the Malifaux figs I wanted because they didn’t have them in stock.

            The online retailers I have visited don’t typically have that problem and if I was shopping for Malifaux or some other independent game then I suspect that I would have had a problem not picking up a pile of Malifaux figs.

            Its just as easy to go to an online store and if they have the stuff in stock that you want then you can purchase the figs and get your purchase feedback rush

          • Psychotic Storm

            Ill accept that, but wasn’t that a problem of the B&M store not sticking sufficiently something a consumer would buy?

            On the other hand you knew you wanted Malifaux and since it wasn’t there you went online, if it was around you would not have bought it from an online retailer because you had it available right here right now.

            Its entirely different to have a quick idea and just get the model off the self and on the conversion table same dy and another to know you will wait a week on average for the model to come, it makes the purchase better thought of more researched and in the end that may even cancel the idea, because of the time devoted on planning it, because it will get a week to come.

            I don’t know if I conveyed the above well enough..

          • Zac

            I have never been recruited into any aspect of the hobby by a shop. My peer group does that. We game at clubs and provide our own premises.

            The UK is a much different beast in this regard than North America where most of the gaming is in stores or people’s houses.

            I know of very few clubs in Canada but a lot of people that actively game at one or two stores.

        • cybogoblin

          You conveniently did not address my example of how gamers are cheap and selfish heh.

          Are you sure?

          Gamers are motivated by a desire to maximize their hobby returns per dollar as much as any consumer is.

          That pretty much covers it for me. To be honest, when you can save 50% off the local price, you’d be foolish not to buy online. I do try and buy from my local store, but there are times when it’s simply not economically viable. If prices in Oz and NZ were more in line with those in the UK and US, you’d find a LOT more people would happily buy their products locally. Profiting from a product is fine, as long as said profit is fair and equal. Sometimes it feel like we’re paying extra to make sure Little Jimmy in the UK can be taught how to paint, because GW sure ain’t putting money into the local gaming scene (outside of their stores).

        • Virral

          A business model that relies on charity and pity from your customers is not particularly viable.

        • Zac

          You conveniently did not address my example of how gamers are cheap and selfish heh.

          I did. Gamers are no more cheap or selfish than anyone else in a society that has seen the triumph of stores like Walmart.

          We live in western societies than triumph globalization so why should people be expected to be any different than the society at large?

          • General Hobbs

            So you support putting brick and mortar stores out of business.

          • Acknowledging the phenomenon exists isn’t the same as supporting it.

            I think the sticking point was since you said “gamers are cheap and selfish” it makes it sound like you are singling gamers out as such compared to the general population. You may be right that gamers are selfish, but not because they are gamers- it is more likely because they are human.

            Doesn’t take much sifting through evidence to come to the conclusion that humans in general are selfish and short sighted. It’s probably an overall primate trait: monkeys will reach out, grab a piece of fruit, take a bite of the best part, drop the rest and reach for another.

            With that wired into our nature, brick & mortars have to find a way to make the symbiotic relationship with their customers unavoidably obvious and give them a reason to spend their money that scratches that selfish-bargain hunting itch or the immediate gratification, like pay to play events, better priced alternative products, etc.

            GW trying to engineer it by enforcing a mercantile structure isn’t going to work: people will still see the cheap green grass on the other side of the fence, and if they aren’t allowed to buy it, they won’t be content paying more for no apparent reason: most will find a way to get it at the price they want or they’ll resent it and change their hobby focus.

          • Grim6

            That seems an extreme characterization of the view. As a consumer, I’m frankly tired of the claim that gamers have some sort of obligation to be naive consumers. The internets have been around now for a few years now, and it should not be a surprise to anyone that it affects how goods are bought and sold.

            You catch more flies with honey than vinegar. Rather than focusing on guilting consumers into a begrudging sense of obligation, how about focusing on providing an added value to customers? Identify those things that Brick and Mortar Stores provide (which online stores do not) and monetize that resource, in a smart and positive way.

            Or, just bury your head in the sand and pretend that the internet doesn’t exist. Whichever…

          • scottjm

            I’m going to make a bold statement here but in my opinion I think in this day and age we need to come to terms with the fact that the B&M game store’s days are potentially numbered.

            If a store only sells miniatures and wargames then they have to realize that they are competing against online retailers and they are going to be fighting a serious uphill battle that they will most likely lose. For a B&M store to survive it has to diversify and sell not just wargames and their figs but sell board games, card games, RPGs, comics and even collectibles.

            GW is trying to stick their head in the sand and ignore the march of progress. Online stores are a fact of life. They will more than likely be able to sell stuff cheaper. Most if not all game/miniature companies are able to survive and thrive without having B&M stores. GW sure gives the impression that they can’t. They are wrong.

          • deedoublejay

            @Grim 6
            “Identify those things that Brick and Mortar Stores provide (which online stores do not) and monetize that resource,”
            What are these things?
            1)Tables to play on
            2)Organized play (Game nights, tournies, etc.)
            3)The ability to see a product in person before deciding to purchase it.
            So how does one monetize these? Charge players for table time? Charge more for events than is required to cover prizes? That’ll have customers coming in.

          • General Hobbs

            Gamers should be responsible and support their local game store, if they want the hobby to exist. I for one don’t want fat, smelly, rude gamers who have never touched a woman hanging out in my house…so I need a game store to enjoy the hobby at. I like playing different people and playing in tournaments…so I need a game store to support that.

            It is well known that buying food and making it at home is alot cheaper than going out to eat. But people still go out and eat at their favorite restaurants and drink at their favorite bars. They don’t quibble at the prices. You pay alot to go to a football or baseball game…but the popular teams continue to sell out their stadiums. People don’t blink an eye. Rock concerts sell tickets 1000 bucks a pop, and the popular artists sell out.

            Why do gamers then not support their hobby and venue? Why the attitude that GW etc owe them low prices?

            I think a good part of it is that alot of gamers are fat, smelly, uneducated guys who have never touched a woman and never worked anywhere but McDonalds, or are dependant on mom and dad sending an allowance down to the basement. They just don’t have the cash to spend on figures, so they nickel and dime and whine and complain about prices.

            look at car dealerships. I can’t afford a corvette..I don’t go online and complain to GM that they would sell more corvettes if they lowered their prices.

            Suport your local stores. Suck it up.

          • jim7

            I too wish i could edit…

            Why do gamers then not support their hobby and venue? Why the attitude that GW etc owe them low prices? I think a good part of it is that alot of gamers are fat, smelly, uneducated guys who have never touched a woman and never worked anywhere but McDonalds, or are dependant on mom and dad sending an allowance down to the basement. They just don’t have the cash to spend on figures, so they nickel and dime and whine and complain about prices.

            I’m going to have to call the BS flag on this play. I’ve been playing games for about 6 or 7 years now in a few separate places and I’ve only witnessed a few of the people you just described. Most of the people in my community, for instance, are in their late 20s to early 40s and all have respectable jobs and families to support. GW keeps pricing them out of the market. The most they want to purchase now is just enough to finish the current armies they’re working on. I mean, thinking how much it costs to have a decent sized WHFB army nowadays is mind boggling. At some point in 20 yrs there’s just going to be 3 people playing GW games and they will be supporting GW.

            GW doesnt owe anyone low prices. We’re just all trying to comprehend how you can cut costs and shoot up prices with (what i perceive as) diminished demand. Their marketplace is getting populated really quick with companies like PIP and Wyrd ready to sell armies that don’t need a million models to play and don’t cost $200 to start.

            Also, your GM example doesn’t hold true because the people that can’t buy a corvette can buy other cars that are more affordable by the same company. GW just sells 3 games, all with similar prices.

            On another note, is it just me or does Hobbs seem to have a lot of contempt for his contemporaries that play games?

          • Dragonstriker

            “So you support putting brick and mortar stores out of business.”
            “Gamers should be responsible and support their local game store”
            “Suport your local stores. Suck it up.”

            These comments betray an appalling sense of entitlement. 1985 called and they want their business model back.

            What right do you have to expect my money? Why should I be forbidden from shopping around? I’m not whining about GW’s prices, but I am pretty hacked off that they are dictating whom I am allowed to spend my money with.
            I actually do support putting brick and mortar OR ANY OTHER stores out of business if they don’t offer me what I want. They are businesses, not charities and I don’t owe them tribute. Any B&M store that doesn’t want to compete in the marketplace shouldn’t be there. That being said, competition doesn’t have to be on price alone, but when today’s exchange rate is 1 GBP = 1.53 AUD, a 15.50 GBP (GW UK) box of dark eldar wyches should cost 23.72 AUD, not 41 AUD (actual GW Oz price). Telling me that I need to suck up a 70% price margin to “support my local store” isn’t going to wash.

          • Grim6

            @deedoublejay – I am not a store owner, and don’t know the profits / margins / etc, but bottom line it seems pretty apparent that these businesses need to adapt. It’s hard to charge for what is already free (like playing in the store), so as I said, they have to come up with SMART ways to monetize their services. Do things that make that game space more appealing – have a full food / drink service as a profit center in your store. Yes, charge a cover for events (most people do already). Or maybe just make the play space more professional, with paid demo people who are professional and eager to show potential new consumers how to play the games. Bottom line, provide something to the consumer, rather than demand something from them.

            @General Hobbs – you already declared that most owners are “retards”, but now it’s the “fat, smelly, uneducated guys ” who are the problem? Misanthrope a lot? Back on point, though – how about having a game store that is clean and professional? One that is a wife, girlfriend, or non-gamer will not be scared to go into. Consider the professional standards you expect of any (non-game) place of business, and ask why we accept less from our game stores?

          • Psychotic Storm

            @ General Hobbs

            Are you for real?

            In any case at best you need a club not a game store, as I said above the hobby can exist without stores and as a consumer I can judge were my money are better and most efficient spend.

            I own nothing to any store and no store owns anything to me, if they want my money they will have to work for it and likewise, my money well spend give me no entitlement over the store I spend it on.

          • Zac

            So you support putting brick and mortar stores out of business.

            Wow. Are you reading anything that other people write?

            I think you might also not have read my other comments on this issue.

          • Zac

            I for one don’t want fat, smelly, rude gamers who have never touched a woman hanging out in my house…

            You really don’t do your argument any benefit with this sort of hyperbole and you don’t need to this sort of rude characterisation of people.

            In fact I am going to have to ask you to refrain from this sort of rude and insulting characterization of people that you appear to disagree with. Its insulting and it lowers the tone of the debate.

            If you can’t try to make your point without these insulting generalizations then perhaps you shouldn’t post.

            Thanks

          • ninja007

            He shouldn’t post because he has nothing to say and utterly fails to grasp even the basics of the situation. Don’t even think of attempting to chide me for pointing out that fact, it’s good for the debate, good for the site, and good for everyone to kick the legs from under self-aggrandizing, lying bullies and apolositst. It’s not a “personal attack”, it’s a simple fact that would be what a CAMERA would play back. 😉

        • jim7

          I don’t think you can say that “all gamers are selfish”. Living in a large gaming scene in Orlando shows you that. We have around 5 stores in a 20 mile zone and all serve the larger community. The only people that would buy ANY stuff online, let alone all their 40ks, would be the noncompetitive people that just play in their basement with their friends anyways. However, the vast majority of gamers in the area support the stores because its the stores that run tournaments and the stores that bring in more bros to play.

          GW games are largely competitive these days (at least since ‘Ard Boyz started). Without an LGS, a player’s only real option for tournament play is to fly to Adepticon or Gencon or something. An LGS also offers a community of people who can help you get better at your game. At the very least, an LGS is someplace you can go to BS and hang with some bros with similar interests.

          It’s true that you can get stuff way cheaper, and for large purchases ($300 or more) I don’t see too much of a problem with finding a place to save a big chunk of money. However, if you want to keep the community aspect so you can go and play different bros, hang out, and have a good time, you should make sure you at least buy a box of troops or a land raider or some blisters from your LGS. The only alternative is hiding in your basement painting minotaurs all day.

          On a side note,

          So then the only reason all other games exist is because there are B&M stores to promote, sell & support their products? Not likely. I think word of mouth and the net play a much larger part than you think.

          That’s probably true for some of the smaller games (hell, that’s why we all read TGN), but GW is a big enough company that it couldn’t hope to survive the way it is with internet sales alone. Without LGS support, they wouldn’t the community couldn’t grow beyond the underground gaming groups. I’d say that the same goes for PIP and any other game maker as well.

        • ninja007

          Obviously inane troll is inane and obvious. Banhammer, please.

          Also, calling b.s., you have VERY shaky knowledge of this entire subject, which you demonstartate time and again, from your laughably silly generilizations, to your grossly false assertions of fact. You never worked in the “industry”, you worked at a small local game store one time, have too much money tied up in GW product as a player, and are desperate to find any sad little justification for their teribad business sense and ethics, so that you don’t feel foolish for supporting them.

          • Zac

            Obviously inane troll is inane and obvious. Banhammer, please.

            Hardly anyone gets banned here and certainly not for something like this.

  • Amarel

    There’s also the need to track the return on marketing and hobbyist investment spend. It might be the case, right now, that it seems like US, Canadian and Australian (for example) stores aren’t worth the money spent on them, but with easy to get stock from UK online stores it’s impossible to tell.

  • “We only recover this investment if customers then buy products from us.

    Mail order only, it is coming…..

  • AceWasabi

    LOL @ General Hobbs’ remark “Gamers are cheap and selfish”. Truer words were never spoken…sure there are exceptions but after 35 years or so of gaming with lots of different crowds in lots of different places that comment is pretty much spot on. For that matter so are his comments about the vast majority of store owners.

  • Its never nice for a manufacture to impose strict sales rules. I used to sell GW stock online but last time they changed the bands so my discount was at a level that i just didn’t bother. if i ran a shop and did intro games al all that would have been worth it to some degree.

    The point is true they do pump a lot of effort and staff time ( free) into getting people into the hobby and showing them new things running games night ( and yes they do make money from it but why not) I’m sure that many people got introduced to wargames this way and when left GW may have moved onto other games.

    I’m happy they do as I feel in some way it keeps the new blood coming and I’m sure other retailers benefit and the whole industry will have some of those customers at some point ( we may not want to admit it ) but if GW die I’m sure there would be a massive impact on the gaming industry as there would be very little retail network to grab the new blood and get them gaming and buy stuff .

    On the plus side if the price remain at a higher level and the hobby center make new games ,makes other manufactures look more appealing and affordable .

  • What I noticed was the concentration on the remarks about “new hobbyists.”

    The current GW hobbyist doesn’t really figure into Mr. Well’s letter above except minimally.

    To me, GW is only concerned on the new, younger player, not the current, older gamer who has been a die hard fan. I’m curious, right now, how many GW fans are less than one or two year hobbyists compared to three plus years?

    Also, I diverge, but my response has me thinking- When is a game hobbyist considered “old?” lol

    • Modhail

      All that stood out to me about current GW hobbyists was this: “existing customers, helping them stay in the hobby longer.”
      Stay in the hobby longer, not stay in the hobby
      To me that gave the impression that they don’t seem to care that you leave, but only that they’re worried they can’t milk you enough before you quit.

      The basic attitude of the explanation seems to grind down to: We need more of your money to recruit the people that replace you after you quit.
      A lot of words spent on recruitment, precious little on customer satisfaction or retention.

      My wallet has been looking an awful lot like a voting slip lately…

    • General Hobbs

      Varagon,

      GW’s studies have shown this..a new recruit spends, on average, 2000 dollars the first year of being in the hobby. The next year, he may spend around 1000. The year after that, 500, if they are lucky…and so on. Veteran gamers spend less than the new hobbyists. Are there exceptions? Yes….But as a rule, GW and other game stores know the money is to be made with the new players.

      • cybogoblin

        Surely it is also wise to cultivate the long-term gamers to make sure that they stay with the hobby and keep spending the $500/year. Yes, you still need the quick money from the newbies, but a steady, regular source of money is just as important and helps make the company more stable in the long run.

        • General Hobbs

          That 500 becomes 250 and less and less.

          • Psychotic Storm

            less and less of a growing pool of veteran players is still more than more money upfront from less and less new players.

            Plus the veterans and not the new players are those that give the product its value, GWs product has no real value without the players to play their games.

          • General Hobbs

            The new players can always play against each other.

          • scottjm

            And without veterans, that’s less of a pool of people to introduce new players to the game. With ridiculously ever increasing high prices, how many 12 and 13 year olds are going to wander into a GW store and drop $200.

          • General Hobbs

            Mom and Dad will pay alot to keep little Timmy happy. I’ve seen parents walk into a game store and drop 500 on product right away.

          • cybogoblin

            Until they release a new army that interests the veteran, or a new range of models that are vastly better than the previous ones (see: Dark Eldar), then they’re back to spending more money again.

            Does that make sense, General Hobbs… or should I say… Mark Wells!?

            (The last bit was not intended seriously. It’s Monday morning here and I feel the need to lighten the mood a little)

      • Good point.

        However, retention is also important, especially if money is made exponentially by retaining players.

        Do you want five players to stay in the game after three years or one new player for one year? Do the math. Also, older players are more likely to become volunteers, run events, and do those “free” events- painting and clinics, to recruits new players.

        I think that the crux of the letter left some important people out of the equation especially after being in the business for how long? Do they need to make a much larger player base of “older” gamers mad or a smaller player base of new players happy?

        • I wish I could edit- Since I’m mathematically challenged, and I know others out there like me, I’ll do the math here:

          Five players at three years x $500= $2500
          One player at one year x $2000= $2000

          I have no figures on number of new players VS retained players, so this is really just throwing ideas around. Hobbs, without any stats from either side, we are both out of luck on proving our points I suppose.

          • General Hobbs

            I’ve seen the stats. There’s an old saying…you can believe the butcher, or you can stick your head up the cow’s ….well you know.

          • Veritas

            Well, unless you’re coming out and admitting to be a GW head office exec then that means you can’t exactly paint yourself in the role of the butcher I should be putting my faith in.

          • AC14

            Unless you can cite some references that offer data on this, your numbers may as well be no more credible that some that have been completely made up – reciting trite phrases doesn’t change this.

        • General Hobbs

          At one point a GW store in the South of the US paid a guy to give demo’s at a local super grocery store. two days, maybe 12 hours total.

          The guy averaged about 2 demos an hour. That’s 24 demo’s. Out of that 24, he sold 4 starter sets. On average, 2 of the people became hobbyists. He did this for 6 months. That’s 24 weekends, which is 48 new hobbyists. Now imagine how many new hobbyists were recruited in store.

          There has always been too much emphasis on the importance of veteran gamers. The money is with the new hobbyists.

          • Killraven

            General, I’m assuming you’ve aquired all of your business accumen from GW training? You speak like a Games Workshop Business Manager, which means nothing like a gamer at all.

            The new hobbyist is a splash in the pan, a few quick purchases, then they tire of the work involved and move on to other pasttimes.

            The veteran gamer, over time, purchases multiple armies, each getting vastly larger than needed, all in the name of variety, flexibility, and simply wanting to have to neat new stuff. In the big picture, the veteran will spend more money than the temporary “hobbyist” ever will, but GW only cares for the hobbyist, because that is who pads the numbers for quarterly stock reports.

            The veteran gamer branches out to other game systems to keep from getting bored. They pour money into the tabletop-gaming industry as a whole, for all of their life, not just for 1-3 years.

            The veteran gamer will teach people to play the game, not just collect a few random pieces. They might teach a few people through their local gaming store, they might only teach their own kids to play, but those kids will bring some of their friends over to learn the games too.

            The veteran gamer is what this hobby and industry are built on. The table-top gaming hobby. There is no Games Workshop Hobby except in one corporations fantasies and marketing plan.

      • Ive heard this before, but I see veteran players dropping 2k every time a new codex comes out. They have to have the new broken list, otherwise they wont win anymore..

  • pbeccas

    If international currencies have moved from their historical values then it’s time to adjust your international retail prices and people won’t spend online. Why are Australians paying double for the exact same product in the UK and the US?

    • gdaybloke

      I’m with pbeccas. The Australian dollar is currently stronger than the US dollar, but Australian MSRP is anywhere up to double US MSRP after the price changes come into effect.

  • Psychotic Storm

    In short he says.

    We want people to by directly from us and if and only if we do not have any stores around, we want them to go to local stores, we want the margin all for ourselves and we do want our customers in a sealed environment were they cannot be contaminated by other companies.

    GW does not want the competition a local store by definition has the competition in it, I also find ridiculous the claim their stores are the reason the hobby exists around, sorry my country never had a GW store and most of the world does not have their stores (one person stores from what I get too) the hobby can survive quite well without their stores than you the only thing they provide is a sterile environment without competition and the extra margin going directly to them.

  • £2000 in the first year?!! Gosh, are parents mad nowadays? I think I got about £50 worth of models the first year I got into GW stuff! Probably less. WHo has £2000 to spend on figures?

    But seriously, do people really spend this much? Why dont they buy shares in GW instead?

    • To be fair, 2k is only a HQ and 2 troops…

    • ninja007

      Made-up numbers.

  • scottjm

    It amazes me how GW can’t deal with a currency issue but every other game company can.

    • Veritas

      Exactly. Fix the pricing issues in the inflated markets and there would be NO problem with people shopping overseas instead of locally.

    • Marauder

      Totally agree. Being in Canada I’ve seen some really silly price discrepancies. It really feels to the consumer like they are forcing you to pay extra only because some one couldn’t figure out the exchange rate. Its a big turn off and drives you away. And that of course is another reason why I never play or purchase GW anymore.

      -Tim

  • McMarlin

    Why does everyone tend to see only in black and white? Obviously it is no option in the long term that local stores wouldn’t be able to compete with webshops – what is the point of any store owner in AUS to recruit a new customer to a GW system if he knows the first time that guy plays with other hobbists or if we he checks the inet, he’ll likely start to make all further puchrases online. GW spends a lot of resources to get new players and everyone pays for that – no matter if he needs any of their service or not. They are the only company that does that recruitment and service at a professional quality level – all other companies rely on other hobbists or shop owners (and very few shops of the many I visited do a really good job at that – they usually rely on their customers for demoing etc.pp).
    Localised pricing is nothing new – anyone in the EU would prefer buying his ipad at the US retail price instead of the EU one. Assuming that the GW guys are not stupid and care for their money they will have done some math and have numbers on the average money / effort required to aquire a new players in other regions – possibly that along with higher wages has to do with the local price. We can only guess. That GW will put everything in nice words is obvious and to me it seems as well that some differences are pretty much extreme and I would have expected at least a slower annual price increase in the regions. That independent local stores in these regions are a bit protected with these news terms seems good for the hobby in the end. The people will spent more money in the local stores – if it is on GW products or not doesn’t really matter. The big loosers are mainly two large UK online stores, but I doubt they sponsor or reqruit anyone oversea for the hobby-

    • Zac

      GW spends a lot of resources to get new players and everyone pays for that

      How so? It doesn’t advertise and outside of its stores and its events it doesn’t promote itself through other events like GenCon or in other magazines.

      GW has a presence based on its sheer size and the size of its fan base but I don’t really think that you can say that they spend resources getting new players.

      They get new players because they are the biggest game in town… they don’t do anything to promote themselves since they don’t need to.

      They are the only company that does that recruitment and service at a professional quality level – all other companies rely on other hobbists or shop owners

      But GW is a shop owner in these cases so how is it any different than any other store that provides painting lessons and demos?

      And how is the level of recruitment in a GW store any different than that in a regular store, event or club day?

      We can only guess.

      Not really. I know several local managers that have been told that the prices in Canada have been set by GW UK and are based on what they think they can sell product for here. Black Library have also told me that they base their book prices in Canada on what the :book industry” charges and that this is the reason for the higher Canadian prices of their books.

      GW has also told people in Canada for years that the prices here were based on the UK exchange rate when they clearly were not even in line with the UK/Canadian exchange rate.

      All of the info I have been told could be BS as well but the problem is that GW won’t just come out and explain why the prices in other areas bear no relation to the actual exchange rates and when they do this they leave people no other recourse than to assume the worst and that they are price gouging.

      That independent local stores in these regions are a bit protected with these news terms seems good for the hobby in the end.

      I don’t think so. People didn’t want to pay the prices and went online. I don’t see how this is going to do anything other than cut into their sales as people just either don’t buy new figs or move to other games.

      A lot of the smarter retailers I know have been cutting down on their amount of GW products they carry and the focus they give the game for some time now and I suspect that the average FLGS is just going to expand their ranges offered to try to keep gamers coming into their stores.

      The big loosers are mainly two large UK online stores, but I doubt they sponsor or reqruit anyone oversea for the hobby

      Probably don’t but keeping people out of the hobby because of artificially inflated prices isn’t going to help either.

      • How so? It doesn’t advertise and outside of its stores and its events it doesn’t promote itself through other events like GenCon or in other magazines.

        This is quite true. I write the occasional article for The Ancible and I have to be stupidly careful with how I even mention GW products in my articles. Something as simple as comparing prices between GW and Mantic was extremely thin ice because GW is so damned touchy over these types of things.

        And you’re right, Zac; they don’t advertise anywhere else. They put on their own conventions instead of coming to something like GenCon. Makes them seem a bit coincided with a “you’re not good enough to hang out with us” mentality.

      • McMarlin

        How so?

        Possibly your local independent stores are totally different than most I’ve visited mainly in the european region, but none I know a bit better offer to new customers: Take a seat, choose a miniature and let’s paint a miniature and we provide all the materials. And in particular would be willing to do so with a 12-year old. For many games they won’t have painted armies themself and for a demo you’d need an appointment and you’d likely face a local player who might as well provide the army. Again many wouldn’t feel comfortable doing so with a kid. The very reason I loath staying in a GW store usually since these kids are all over the place and parents at times seem to almost abuse it as a day-care thing, but the staff of these stores are playing along. On a regular basis they have small events. And their staff has training in doing demos, etc – if you rely on other fans/customers of your product to demo your product you might have luck or you might end up with someone who enjoys showing his superiocity against a beginner. Unfortunally I met several guys who’d enjoy winning against those new to the hobby/ game. GW wants to control everything and have certain standards with all of these thing (which can be good or bad) – anyhow paying someone full time is much more expensive.

        Concerning their presence – they are the only stores that are placed in the main shopping streets at a central location. Most independent other hobby stores are way off
        since they couldn’t pay that kind of rent – you enter these stores since you look know they are there and usually know what you want. I’m happy that my main hobby store for the hobby (who doesn’t have GW in its range at all) is a bit off since I have a realistic chance of getting a parking place.

        That GW will set the regional prices as high as possible – I’m not shocked. As I mentioned, why is a electronic product retail price from most bigger brands usually 30+% cheaper in the US compared to EU. Some people will find new ways to get their products at a cheaper rate elsewhere from Wayland and Maelstrom, but part of their success was that everything is so convinient and easy. And I doubt many will stop continuing their armies because of that if they like the game – they likely have already spent hundrets of hours into it and a massive amount of money.

        Besides if in those regions more stores are encouraged to promote other games – great. I’m a big fan of competition (and don’t play any GW system on a regular basis myself – I got my hands on full the smog line a few days ago).

        Anyhow I think it is silly to claim that above text of GW is all wrong – many shades of grey in there, I bet. Claiming that they don’t spent more money into service than other companies seems utterly wrong.

    • Veritas

      Saying the biggest losers are Maelstrom and Wayland is false in my opinion. The biggest loser is going to be GW. They’re making an assumption that by cutting off OZ, NZ, Brazil, Korea, Japan, etc… that all these gamers are going to just automatically purchase minis at GW’s local MSRP. I think GW is in for a rude awakening. There will always be alternatives. I’ll be getting people I know to ship me new stuff from the states or doing trading on Bartertown. And if those sources dried up I’d just throw in the towel and switch to Infinity, Nemesis, or any of the myriad of other fantastic games.

      I flat out refuse to pay local MSRP for something that is readily available at a cheaper price. GW has to be the only company I know that expects you to pay full price just because they tell you to. If you lived in a town with $6 a gallon gas and the next town over had $3 a gallon gas would you support the $6 station simply because it’s in your town?

      • If you lived in a town with $6 a gallon gas and the next town over had $3 a gallon gas would you support the $6 station simply because it’s in your town?

        Well, depends, in regards to gas prices, since mileage varies. I bet some gamers would say the same thing that their “mileage” varies in regards to their games.

        I live less than four miles from the Missouri border and gas is always cheaper in MO than KS. I can’t drive the 6-8 mile round trip and save the difference on gas.

        However, I’m just be cantankerous, and I understand your analogy and the point you are trying to make. Why buy my model locally at 100% of cost when I can order it for 80% of cost and pay only 5% in shipping if it’s not to support my local stores?

        • Veritas

          If it was only a 15% difference I’d happily support my local store. However, here in Japan the GW MSRP is approximately 80-90% higher than in the UK or US. In other words, I’d have to have some form of mental disease or have more money than sense to shop for models in country.

          • General Hobbs

            So, if the store pays x in rent and y in salaries, and is dependant on selling product to pay for said rent and salaries, and because the local gamers buy from online discounters the store goes out of business…

            doesn’t that help kill the local hobby? I know when the local stores here closed, everyone stopped collecting/playing.

        • Zac

          Why buy my model locally at 100% of cost when I can order it for 80% of cost and pay only 5% in shipping if it’s not to support my local stores?

          Are you in the US? If people in Canada were only getting a 20% discount I don’t think it would be worth it but with the exchange rate some products are far more than 20% off when you factor in the discount that online retailers give.

          • I need to say that my examples with numbers are just that. Not factual information. Sorry for the confusion.

            I am in the US though.

  • In Australia:

    Our Local Gaming Store is already looking and welcoming alternate gaming systems and doing very well with them.

    Love GW’s work, Hate their policies and this is the result. Lost sales for GW.

    Bonus: It is probably doing more for the hobby as existing and newcomers are seeing all the stuff that is out there and are keen to start other games (Historical and other).

    I have already spoke with our Local Gaming Store about running Demos in other game systems that are not stocked (Yet!), to help take up the VOID left by GW.

    • Zac

      I’m seeing the same thing here as well. My FLGS in Vancouver had an FoW section that was the size of the 40K section and a Warmachine section as large as the WFB section. They also carried the odd bit of some other games as well.

      One of the local stores here in Calgary has a pretty small GW section and a very large area devoted to Spartan, Malifaux and other games.

      • cybogoblin

        My FLGS is trying to support other games, but is having a bit of trouble. They don’t have any problems getting FoW stock (being walking distance from their HQ), but the Warmahordes distributor is in the middle of bankrupcy proceedings and can’t send them any stock, and other smaller games never caught on. There’s still a large GW presence, but that’s because they’re able to get the stock in relatively easily.

        • Osbad

          While in many cases there may be an established, possibly sizeable, GW gaming community, this is not the main issue for a game store to consider (although it may be hard for them to ignore). The issue for the game store to consider is “where will my future product sales come from?”.

          If the GW scene is dwindling, and that of others is expanding, then GW will not hold their supposed “dominant position” for much longer. At least in well-run game stores.

          Promoting game systems that are easier(cheaper?) to get into and offer just as much, or more, opportunity for fun seems like the best investment of a game store’s limited resources, rather than relying on the unsustainable offer of GW.

  • Mooniac

    This explanation from GW seems about right. Also, most of the comments so far are various forms of hyperbole from both sides. Mostly predictable stuff.
    They let this stuff get out of hand for too long. They would be better off cutting off all online sales except their own, IMO.
    Unfortunately, they are doing so many other things wrong that this may not turn out well for them.

  • Killraven

    First off, I’d like to correct one repeated mistake of Mr. Wells and of others from Games Workshop. In reference to the “Games Workshop Hobby”, THERE IS NO “Games Workshop Hobby”, Games Workshop is merely one facet of the tabletop gaming hobby, no matter how much they’d desire it elsewise.

    (1) “We provide all these services free of charge. We only recover this investment if customers then buy products from us.” – – – The investment is recovered by people purchasing GW products. GW collects their good share of that price whether it is purchased in a local shop or via an online reseller.

    (2) “We support these businesses with local customer service teams and warehouses to ensure customers have immediate access to our best selling products and new releases.” – – – Amidst horror story after horror story of local gaming shops not being able to get new release models in the first month of release due to “shortages”, but the local GW store has stacks of them.

    (3) “the simple fact is that European internet traders will not invest any money in growing the hobby in your country.” – – – True on the face of it, but they do help to get merchandise into areas that don’t currently have enough demand to support a local store, and that still helps to support and promote the hobby as a whole. That”s part of the big picture.

    (4) “That is why we took the decision to take legitimate action” – – – There’s a big difference between legitimate (legal) and moral.

    (5) “the loss of volume would leave Games Workshop no choice but to scale back our investment in new product development, further eroding our customer base. ” – – – I tend to think that during tough economic times, having continual price increases that are 200% or more in excess of standard inflation has a significantly greater effect on eroding the customer base then a mail order store selling at a discount. Furthermore, I tend to believe that the majority of people ordering via the internet are living in areas where there are no local sources at all. Myself for example, I live in America and the closest GW store is a seven-hour drive. I like ordering from European mail-order places because while getting the GW product I want I can usually tack on a few neat extras that are otherwise not available in North America at all.

    (6) I may be inclined to believe Mr. Wells letter a wee bit more when GW announces that their mail order store will not sell outside of Europe either.

    • Veritas

      Even with GW UK’s exorbitant shipping costs it’s still cheaper to order direct than to order inside Japan. 🙁

    • cybogoblin

      GW will never limit their own store as they consider themselves a ‘global’ company, able to improve the hobby anywhere they want (or so they say). Also, when you buy direct you still pay the same as you would if you were purchasing from a local store (unless said store offers a discount).

  • I don’t know if it’s unique to my location but here gamers make new gamers… there are no GW hobby centres.

    I think he’s way overrating their importance.

    I’ll give him that they’re good at making money though.

  • Kane856

    Surely the whole problem is that due to GW’s pricing it is cheaper for Aussie gamers to buy from the UK than it is to buy from local stores – and not by a small %age the price difference is phenomenal – I haven’t checked but is the price difference for other manufactuers as extreme?

  • Lord Abaddon of Wormwood

    I would be surprised if it wasn’t cheaper for Southern Hemisphere retailers to buy wholesale from Maelstrom & the Likes at a their retail price – it would be interesting to find out how much our gaming stores get shafted also by GW.

    I just pray that other core games out there, like Infinity, PP, BattleFront really push their boots into the hole left by GW.

    Me Infinity – I think. Or a bucket load of 15mm for mass mayhem.

    Lord Abaddon of Wormwood

  • Osbad

    Mark Wells seems to believe we don’t see the whopping great hole in his argument. The simple concept that more gamers are likely to be put off from starting the GW hobby TM by high prices than are going to be convinced to join it.

    My son, aged 10, is gagging to play 40k. On his allowance he can afford one new box of toy soldiers every so often. Every very so often, as his allowance isn’t huge. Sure he has Christmas and Birthdays to ask for stuff, but then its a choice “A box of toy soldiers or a new bike (or whatever)” and the box of toy soldiers is less and less likely to win when its relative cost increases every few months. Fortunately he has a dad who is familiar with eBay and with the local 2nd hand scene, and so he can actually access stuff at pocket-money prices. If he didn’t have me to help him, however much his local store had triedd persuading him he’d have walk away as he couldn’t have bought stuff at a rate that would have kept his interest.

    Sure local stores have a role to play in the development of the hobby, but the more ridiculous the prices get, the less easy their task becomes. GW, I feel, would be far better served if they helped local stores by not gouging on their prices and instead keeping them reaosonable.

    But what would I know? I’m just someone who’s been collecting toy soldiers for over quarter of a decade. I’m not the head of a multi-national company who developed my business acumen by selling soap and shampoo…

    • Nightbee

      Quarter of a decade? Old-timer!

    • If nothing else your son will learn the value of money.

      You might be surprised at this but my friends and I also could not afford to buy everything we ever wanted growing up. We also had to save and choose between a bike or a Space Wolf dreadnaught. (Yes this was an actual choice. And this was the nineties!)

      The prices of all miniature manufacturer’s have gone up. GW isn’t alone in this. I like the fact that they do stand by their B&M retailers.

      • Osbad

        Well, there’s “up” and there’s “UPPP!!!!”. Back when I started a single metal model cost often less than 25p. Yes, I had to save, but it was possible. Now, its just not possible.

        And personally, while I applaud their support of some B&M stores (Wayland and Maelstrom are also B&M stores), I would prefer it if they supported their customers. I would say loyal customers, but there are pretty few of those left these days…

  • GW has this agressive company strategy now for many years but more and more people are realising it !
    Here local shops and in the first place, the gaming clubs keep the gaming hobby a live.
    The free workers have never been respected by GW and had more trouble as help from GW organising events and helping ‘for free’ selling their products.
    This hard work from volunteers gives healty gaming communities, most of the time supported by a local gaming store that is supporting many other different games.
    Once a GW stores shows up in the area that local stores get it hard and close. Goodbuy gaming community and the different games. Welkom a small GW community focussing on bringing in newbies for a short and quick GW products selling.
    Many people don’t buy it any more and aren’t buying GW products and start with the discovering of a new world of gaming possibilities without the GW products !
    In the past you almost get killed when you posted a negative reaction about GW.
    The GW reaction on these growing group of negative posts is a proof that they feel it in the pocket.
    Many gamers and GW stil think that we need GW or the gaming hobby is over. Wel I can say, once I was one of these but now I’m happy that I have discovert (just in time) that without GW I’m having the best gaming years of my live !!!

    See you all back in 6 months with the next price … 🙂

  • DarkAngel

    Apart from anything else that’s been posted, in Australia at least, the currency has risen a great deal. Sure, GW pay their fixed costs in Australia at the increased rate. But the sales have more comparative value. This means is that their profit margin has actually increased as the margin has more value due to exchange rate.

    So they are making more money from Australia now per sale.

    They are indeed protecting their local stores and local sales with this policy. However, another strategy could’ve been to drop the price in Oz based on the increased currency value, meaning they make the same margin as before in adjusted terms. This would have reduced the attraction to buy from overseas as the difference would be much less.

    Instead, they decided to cut off the cheaper supply from overseas and continue to try to reap the benefits of the increased net value. Bold move? A cunning corporate strategy? Is it based on the belief that their consumer is immune to effects of price rise?

    Forget the words used in official statements. Rhetoric. That’s the underlying position.

    In 2010 Annual statement you can see that Australian sales have been “disappointing”. It remains to be seen if that was caused by being undercut by online retailers or if it was due to the ever inflating prices driving new customers away.

    I find it fascinating to read the commentary about the average annual spend of new gamers vs old. I accept the experience of those who have been involved in the retail gaming business. I would however point out that veterans also have some flow on benefits like recruitment. I wonder what the average annual spend is amongst my FOW peers who are all mature older gamers like me. I think it could easily be $1000- a year, which is still decent if the newbie spends $2000. Veterans spend longer of course, year after year.

    Have you all noticed how GW have manipulated the game system to increase sales? Models, especially vehicles, cost less in new army lists than they did before. So net effect is that you need to buy more to field the typical gaming army of the points we’re used to.

    I know anecdotally of one case where a parent walked away from a purchase for her young “new profitable gamer” due to the steep price. What does it cost in Australia to get a 1500 pt marine army? It’s a lot.

    My instinct tells me at least part of the decline in Oz sales is the pricing. GW are gunning for that increased return due to inflated currency. I wonder if it will work.

    I personally believe it’s very naive of any business to expect that consumers will remain price indifferent in the internet age, even for a niche market like wargames. I’ll be reading 2011 financial statement with interest.

    The comments by their CEO about investing in new excellent product and the “free” recruitment factor to keep the hobby alive are a smoke screen really. It gives an impression of value.

    Yet these are the simple necessities of their business model, present from the early days. If they don’t refresh their rules and products, people play them to death and get bored and move on. The new product investment simply is part of them continuing to generate sales. So is recruitment and operating stores where people can play the game, hold competitions, etc. They opted to cut out “the middle man” and run their own stores and keep the margins.

    It’s no favour to the gaming world, except that we get a strong, viable company like GW making the stuff we like. But they make money from it, so it certainly aint a favour.

    I read a thinly veiled desire to cut out local stockists in the language of the annual report. I had the impression that GW sees them as a necessary evil while they are “penetrating a market”. So from that, LGS beware when they have “penetrated” your area! Of course, that is marketplace competition and a large company exercising it’s capacities. If I were a LGS, I would be extremely wary of allowing too much of the revenue stream to come from GW products in case they open next to me and try to drive me out of business. I’ve seen that happen here in Sydney.

    Eh, every business has to compete and survive. LGS need to outsmart competitors like GW. But don’t think GW are doing any charity to local stockists. They use those to reach areas they are not able to service directly and are simply moving to protect their profits in the regions.

    My reading of the whole situation and GW position is: “We’re going for maximised margins and trust our market will take the increases. Again. And we’re cutting manufacturing costs in moving to resin and trust our market will accept the new product. Don’t tell us how to run our company.”
    🙂

    Ciao,
    Dark Angel

    • General Hobbs

      Dark Angel, I did alot of research into why things in Australia cost more than in the US. Apparently it is not just GW, but everything costs twice as much. Three things seem to be the reason: Things have to be shipped there, high minimum wage has driven up overhead, and the old currency problem. I don’t think rage at GW is…well, the rage should be directed at everything.

      GW’s business model, in their Red Book, is that GW fans love the product so much, they will buy, even in bad economic times. So yes, they believe the fans will buy no matter how much the prices go up.

      • Dragonstriker

        That’s BS. Not everything costs twice as much. And there’s no import duty or tariffs on miniatures. Oh, and those $41 dark eldar? Made in Australia.

        • Dragonstriker

          In case the point is unclear; the miniatures are 73% cheaper after export and conversion to a weaker currency.

  • Osbad

    If nothing else the online discounter has to fight the fact he gets no impulse/ instant gratification sales because of the fact he ships the product to the customer.

    Simply not true. I know this because just this morning I clicked on the news story about the new WWII “Victory Decision” rules from AD Publishing, I then went straight to Wargame Vault and bought a copy. I thought to myself “£8, worth a punt”. Definitely an impulse buy. Now I know that was a download, so it was more “Instant” than many sales, but I have done the same sort of impulsive thing with minis as well. I have from time to time seen an advert on TGN or somewhere else, clicked the link and ordered from Maelstrom, Wayland and others. It is entirely possible to “impulse buy” from an internet retailer, and in fact in my case more likely as I often browse manufacturer’s sites when I’m bored, whereas it takes a specific act of will to visit a shop. And I hate going shopping anyhow!

    • Psychotic Storm

      I disagree to an extend, PDF’s are more towards the instant gratification side of things, there is no way I will log in to Mael or any other online retailer see a blister and just buy it because heck it was there staring me, in my last purchase to get the last discount they did I struggled to find things to buy just to get the fee shipping and we talk about just 10 pounds IIRC, I almost didn’t do the order.

      • Osbad

        My point was not that B&M stores don’t benefit from “instant gratification sales”, but rather that online stores can still benefit from them. Heck, there’s no even much difference in the delay with a good vendor. My spur of the moment Copplestone order for a couple of models was placed around 3pm on a Thursday, and it was in my hands next day! Now compare that with the thought of dragging my carcase into town, finding (and paying for) a parking space, putting up with some inane drivel from the shop assistant and maybe having to wait in line, or squeeze past some punters (who may or may not have questionable hygiene), and there’s no contest. Particularly when online prices are lower than in store, and/or there are models available online that I just can’t get instore (how many of GW’s models are direct-only these days and therefore not available for impulse buys?) I’m simply not going to make an impulse by of more than (say) £20, or maybe £10. How much GW product can I get for those figures these days?

        It isn’t a zero sum argument – but the trend is for more impulse buys from online retailers to become more attractive, and those from B&M Stores less so. Particularly as folks are more and more net-savvy these days. I repeat I’m not denying that B&M impuse buys are important. I am denying that the don’t exist for online retailers.

        • Psychotic Storm

          My perspective is from the point of view on somebody who uses the online retailer and is on the other side of the continent, true if I was to get it next day the behaviour would be different.

          • Osbad

            Fair does. Everyone’s experience will vary. There are two main components to the “impulse buy” (privided it is an item you are predisposed to desire: accessability and price. The lower in price and the more accessible the item the more likely the impulse buy. Internet retailers have a disadvantage with accessibility but an advantage on price. Sometimes (in both directions) the disadvantage or the advantage is more perceived than real however.

  • SirAngry

    This is a real hot potato and I don’t think there re any easy answers. I’m really not GW’s biggest fan atm but on this one I can see what they’re saying. Don’t want to clog the comments section on here up anymore than they are, I’ve written a thorough piece on my opinions on it here:

    http://thefrontlinegamer.blogspot.com/

    • Great post on your blog SirAngry. Direct link

      • SirAngry

        Thanks, I’ve started blogging to try and bring a sensible voice to the gaming debate after hearing so many people over react to many things I felt that I might be able to add some sanity to things. Just need a few more people to start reading now. lol. Glad you liked it.

  • papasmrf667

    So glad I just sold the rest of my GW on ebay, 2 GW armies = 20 p3 paints and 5 Malifaux crews. I can see what GW is saying but still..

  • In fact we should be thankful that GW give us such an incentive to have a try on other games. I gave up evil empire’s games since 2007 and discovered Two Hours Wargames products, Pulp gaming world (.45 adventures, Strange Aeons…), etc and never looked back.. To say the truth I’ve never had such a blast playing any version of Warhammer (Fantasy or 40K)
    Now it seems that unfortunately some people still need to have their Warhammer-ish fix even if they live in Australia or New Zealand. Guys how could you play miniatures while upside down ! 🙂
    So what if some honourable EU gamers create some non commercial entity along the gamers united idea just for shipping items from EU retailers (eg Wayland or Maelstrom) to our unfairly mistreated southern hemispherian fellows ?

  • phoenixman

    IMHO i think GW have this all wrong and Mr. Wells hasn’t actually answered the main issue (certainly for UK customers) in that despite what he says about currency differences etc etc, why do they believe a 26% price rise is acceptable for their OWN countries customer base, at a time of major recession.

    the hobby is a luxury not a necessity and i don’t know of any other business that is putting up prices this high in these economic times, especially as most of the other companies in the market for our money are keeping their prices constant or adding on only a small %, nothing in the region of GW increases, especially when they are as a business still making massive profits.

    surely, the cost for a box of say basic space marines shouldn’t be that much different anywhere in the world % wise so what is the problem with how the gamer gets his models as long as the sales keep rolling in surely GW make a profit on them, unless of course they make more profit in some places than they do others.

    also, where the customer chooses to buy his stuff from is surely up to them, it’s their money after all.

    it is for these sorts of reasons, along with the outrageous (In my opinion) prices for stuff that i have now sold off all my GW stuff and am concentrating on other periods / manufacturers who do give value for money for me as a gamer.

    if other plastic soldier suppliers such as Warlords, Mantic, Perrys and Victrix can put 40, 50 or even 60+ models in a box for £20 or less why cant GW do the same.

    these companies must be turning profits or they wouldn’t keep trading and be able to invest in new ranges etc.

    if as they say they have listened to their customers, they wouldn’t be putting prices up on June 1st, would they.

    • scottjm

      phonixman wrote:
      “if other plastic soldier suppliers such as Warlords, Mantic, Perrys and Victrix can put 40, 50 or even 60+ models in a box for £20 or less why cant GW do the same.”

      That is a very, very good question. The standard answer is the above aren’t as detailed as GW’s minis. And that is a crap answer. Simple answer is money. They want it all.

  • davetaylor

    I’m a little bit disappointed that in almost 100 posts there has been very little discussion of local market costs, prices, wages, and the interaction between the three.

    Local market costs for rent, electricity, wages etc are considerably higher in Australia than they are here in the US. Wages are also considerably higher (Minimum wages in the US is more than double that of the US) for the same kinds of positions. Ten years ago, that extra “value” that you’d find in the Australian paypacket disappeared when you took it overseas (AU$2 equalled US$1 back then, or AU$3 equalled UK£1). Thanks to an improving Aus economy and a declining US economy, that is no longer the case.

    The internet, wishful thinking, and government propaganda have all played their part in creating the false idea that there is a global, free market economy for all. There just isn’t.

    People don’t all get paid the same, their pay doesn’t all spend the same in their local market.

    • Psychotic Storm

      So why the local prices of PP and other companies are in line with the exchange rate and GW feels they have to charge double from the exchange rate, because of the stores? to counter this, when I get charged full price from GW without having any store in my country let alone vicinity, these extra money go to where?

      • davetaylor

        I just did a quick check of the PP prices (comparing the Khador Battlegroup only) and found that they are not in line with exchange rates. In the US the Battlegroup box is US$50 MSRP (currently AU$48) whilst the Australian MSRP is AU$65.

        My point stands though. Privateer do not have anywhere near the same level of overhead (or turnover) as GW. The prices are set according to local market pressures, you may not have a store in your country, but GW has determined what the local market will bear.

        Don’t get me wrong Psychotic Storm, I agree that prices have reached ridiculous levels, most likely driven by a series of questionable business decisions. However, although we’re all buying “apples”, we aren’t all buying them with the same type of money.

        • Psychotic Storm

          I may not have a store in my country and it is my countries responsibility to determine what the local market will bear not GWs, never the less for all my wargaming life I have paid for GWs overhead while never benefiting for it.

          And I agree we do not pay the same money even if we have the same money, local conditions vastly change how much the cost can go, if GW wanted to help local retailers they would help them compete those UK retailers, what I see is GW protecting their own shops and trying with every decision they make to force the players buying directly from them to increase their margins.

          My point of view, I might be wrong, but this is how I see it.

      • McMarlin

        That is quite easy – PP has no support staff, rent for stores to pay in Aus. If GW would drop their stores the prices would most likely be much more inline with other products. This is no real option to them because in order to grow they need to create new customers and they’d have very little influence on that if they’d rely only on independent stores, such as pretty much all other companies. Currently I’d assume that GW still holds 2/3 or more of the TT market (look at the number of people online in gw related forums vs. other companies) and it’s unlikely they could keep that ratio if they rely on independent stores. Their staff and local stores is what makes their product expensive and that’s their only chance to grow the market (get people into tabletop that didn’t know it exists and have no friends who enjoy that sort of thing). Getting people to try a second, third game system is much easier.
        If the costs of a product is mainly about service you have to take into account the local economy and it obviously sucks if you don’t need any of that service (since you play in your club, home, know what tabletop / painting is about or go to gw sponsored tournaments) and yet have to pay for that. No doubt about that.

    • The flaw with this argument is that the retailer’s margin on a GW figure is exactly the same as the margin on a figure from PP or another manufacturer.

      The retail price for a mini is simply the wholesale price + the store margin + taxes. And GW’s wholesale price is higher per figure than any other company’s.

      If they lowered the price, they would sell more. As Osbad pointed out in above somewhere, the entry costs for GW games are horrendous and out of the price ranges of many newcomers.

      (The GST here in Oz is 10%, significantly lower than the UK’s VAT.)

  • Nalik

    This whole thing of raising prices and locking out markets seems to me to be a circle the wagons strategy. They’re pulling back to their core bases (UK & US) and trying to maintain a profit all the while Privateer Press is growing so quickly that they can’t keep product in pace with demand. It’s impact will be interesting on the hobby, if the over seas markets can’t get GW product and alternate to PP it will further increase demand for an already supply limited company. My assumption is that all this is to drive PP out of competition in the US and UK by putting pressure on their open wound. It’s a shame PP didn’t have a good strategy after they launched MKII, they proceeded too conservatively and it’s going to bite them in their arse now.

    • Psychotic Storm

      Hi risk high gain is good, but only in retrospect, PP from what I understand went for the longer and stabler approach, I can’t see how that will bit them, true they may not expand as fast as them may have done potentially if they went go big or go home, but the brightest stars die faster younger and more spectacular, the smaller and duller live longer and can sustain life.

      • Nalik

        PP’s model relies on keeping interest thru new releases. Most shop owners saw dramatic drops during the transition from MKI to MKII. While the majority of the drop was uncertainty in the new system there was also a decrease in releases. Gamers want new models, if they keep with the August approach of we can’t keep up so you’ll not see any new releases then they are going to lose market share.

        • Psychotic Storm

          I still think they perform and support their game better than what GW will ever do and their marketing decisions from what I read are sound.

          And this comes from somebody who does not play or collect PP products.

  • phoenixman

    cheers scottjm; GW minis WERE the most detailed on the market but they have been caught up by some very fine historicals now and at a fraction of the cost per model in box ratio.

    IMHO they couldn’t backtrack on previous price hikes as this would just confirm what a lot of the gaming community have thought for years, i.e. we are being asked to buy at an exorbitant price, but what they could do is come out and say there wont be a rise for 1, 2 or maybe 3 years so that their customers know what they will pay for stuff they want and can afford to plan ahead with army purchases as they would know that if they bought a force spread over this period of stable pricing they would pay the same at the start as at the end.

    GW would get a much better reception from us their customer base and some positive comments for a change.

    i will NEVER go back to buying their models / systems until the prices are realistic. if i ever decide to get back into fantasy i will buy Mantic models and play WHFB with them, as i will also never attend another GW tourney so dont need there minis, just fantasy based ones, although i have no plans to do this as am playing moe ancients and other stuff like dystopian wars, boardgames, wings of war etc

  • cegorach

    I think what everyone is missing is that GW is on the way out slowly but surely because:

    1) It uses rules systems that were bad enough two decades back but are now a joke

    2) Their mini quality was top of the market two decades back but sure as heck isn’t now

    This is where they should be focusing. All this fiddle faddling around in terms of sales modelling is just tuning their violin while Rome burns.

    It’s not pricing that turns new players away from GW, it’s when they go to a club or a mate’s house and play Warmachine, or God forbid, Infinity, and find out what gaming post 1990s is capable of.

    Any short term financial saving here is a waste of time and effort and just generates more impetus for the tsunami of negative market opinion against GW.

  • Mooniac

    Has anyone actually compared the math (or maths for you subjects)? I see above someone said 73 percent difference, but all you solidly socialist countries (as opposed to a sorta socialist US) have lots of hidden taxes (ours are comparatively smaller), so what’s the real scoop?

  • Killraven

    Here’s one more reason on why Games Workshop needs to keeps sales as localized possible: They need to be able to track where sales are strongest in order to put in their own stores.

    • Myrthe

      Sure … they’ll put them right near the independent stores that sold their products and created local demand. Then they’ll abandon those stores to focus solely on their own and then, eventually, pull their own stores when the locals have had enough of GWs antics. It’s happened in CT and MA (USA) on several occassions in the last 10 years alone.

  • Gallahad

    GW claiming that one of their goals is growing the hobby really makes me laugh. They follow a monopolistic pricing structure; they try to artificially reduce demand by raising the prices. They are trying to sell to fewer people at a higher price, this is how a monopoly makes the most money.

    I think that this is silly because while GW might have had a monopoly once upon a time, that monopoly is slipping fast. If GW really cared about growing the hobby, they would sell more boxes at a lower cost. There is certainly a benefit to the hobby of GW having a brick and mortar store presence, but the entry cost of “The GW Hobby” (TM) is so exorbitantly high, it is like claiming that Mercedes Benz encourages more people to drive cars.

    Furthermore, GW has a terrible track record with supporting indie retailers. In fact, if an indie retailer is doing well enough, they move in and set up shop next door. Based on their history, GW wants to screw indie retailers. I think that this pricing structure is extremely short sighted. GW have priced themselves into the luxury goods side of the hobby market. This will not result in hobby base growth.

    I stopped participating in “the GW hobby” after several years of Warhammer 6th ed. and it has been the best thing to ever happen to my hobby.