GAMES WORKSHOP GROUP PLC
("Games Workshop" or "Group")
8 June 2015
TRADING UPDATE ON CLOSE OF FINANCIAL YEAR ENDED 31 MAY 2015
Following the close of its 2014/15 financial year Games Workshop provides the following trading highlights:
We expect the Group's profit for the year to 31 May 2015 to be broadly in line with market expectations.
Over the year we have seen modest sales growth, at constant currency, in our core trade and mail order channels. We saw a small decline in our own stores due to continued difficult trading in Continental Europe following our restructuring last year. We saw expected declines in some non-core activities that are grouped with core activities in our reporting. The effect of these non-core activities and the continuing effects of unfavourable exchange rates mean that our reported sales are likely to show small declines in retail (c.5%) and trade (c.3%). Mail order growth was c.5%.
We will provide full and detailed information, including the effects of adverse exchange rates, at the time of our results announcement on 28 July 2015.
I always love it when they say "in line with market expectations".
Yeah, if the market expects lower sales volumes and increasing prices.
I wonder what these "modest sales growths" are. Perhaps it is only them saying that they saw sales growth where it hadn't been before because there were other sales channels that were selling those products.
Notice they didn't say a "modest sales growth overall". They are making qualified statements for some reason.
I wonder if we will see an overall down trend as we have these last couple of years.
There should be a good reason why their sales have declined in an industry that has seen an aggregate 45% growth over the last three years ( appx 14%-16% each year)
Of course we see that they should be the industry leader yet <strikes deceased equine> they are not.
One day all otiose things shall be gone and they won't have to worry about it.
A "decline in our own stores", da crap does that even mean? Declining sales in their stores or a reduction in the number of stores?
I could see it as fewer sales in their stores due to NOTHING is being done to actually promote their stores!
I think they mean declining sales from their stores.
We saw expected declines in some non-core activities that are grouped with core activities in our reporting
Does that sound like they are going to use that to hide decline in core activities to anyone else? Why not split it out otherwise?
show small declines in retail (c.5%) and trade (c.3%). Mail order growth was c.5%.
Since it's roughly a 33/33/33% breakdown between retail/trade/store, so the store->web thing makes sense (if you're paying retail you may as well pre-order it) and cancels each other out. 3% trade drop is more worrying, less people are buying from FLGS.
Going by the number of traders dropping/reducing GW I'm surprised it's not lower.
I guess all we can tell from this is that they haven't made any miraculous recovery yet and are looking at another decrease in revenue/profits.
I was hoping it would be good news for them. Maybe the new AdMech were relased too late in the year to make an impact. I hope with the AdMech and Age of Sigmar though they'll see a sales growth in Q1 and Q2 of this new financial year.
That feels like a lot of big, meaningless, contradictory words designed to not actually lie, but definitely not give a truthful indication of the state of anything.
It doesn't sound disastrous though, it's not going to be a huge drop in profits, just another decline they'll bluster through. But they are still blaming the restructuring though. I wonder when that'll get old.
reds8n wrote: ... Suspect the "non -core yet core" might cover the Hobbit/LOTR stream .. ?
I'm sure it'll cover the magazine as well, the paint ranges and probably the WHW work. But since it's rolled in there's probably no way we'll find out.
Yeah, it's the exchange rates! And the restructuring we did 10 years ago... and... and... did we mention the exchange rates? And the financial crisis? Yeah, that's why we are in decline, but it's only temporal!
Sounds like a lot of whitewashing financial gibberish in the text and a slow, painfull decline in the numbers.
Howard A Treesong wrote: It doesn't sound disastrous though, it's not going to be a huge drop in profits, just another decline they'll bluster through. But they are still blaming the restructuring though. I wonder when that'll get old.
Howard A Treesong wrote: It doesn't sound disastrous though, it's not going to be a huge drop in profits, just another decline they'll bluster through. But they are still blaming the restructuring though. I wonder when that'll get old.
2 years ago?
They mentioned some ongoing cost for the restructuring, so it was spread over a few years and they could still be paying that (leases on EU offices for instance).
Then there's amortized costs for the webstore, and the HQ overhaul. Lots of one-time-expenses to explain away the drop in sales.
Howard A Treesong wrote: It doesn't sound disastrous though, it's not going to be a huge drop in profits, just another decline they'll bluster through. But they are still blaming the restructuring though. I wonder when that'll get old.
2 years ago?
I think it refers to the reshuffling of the European HQ's (branches) back to the UK plus consolidating stores away from hi rent areas, which is still going on here in my part of the world.
Howard A Treesong wrote: It doesn't sound disastrous though, it's not going to be a huge drop in profits, just another decline they'll bluster through. But they are still blaming the restructuring though. I wonder when that'll get old.
2 years ago?
They mentioned some ongoing cost for the restructuring, so it was spread over a few years and they could still be paying that (leases on EU offices for instance).
Then there's amortized costs for the webstore, and the HQ overhaul. Lots of one-time-expenses to explain away the drop in sales.
They can use those to explain a drop in profit, but there's little they can do to explain the drop in revenue other than the already well trodden "our staff are rubbish, do you have any idea how hard it is to recruit decent people when you offer poor conditions and few benefits?" excuse they've offered before.
Bottle wrote: I was hoping it would be good news for them. Maybe the new AdMech were relased too late in the year to make an impact. I hope with the AdMech and Age of Sigmar though they'll see a sales growth in Q1 and Q2 of this new financial year.
Keep dreaming lol.
The press announcement doesn't say much. I'd expect the report to continue the trend of slow decline in both sales and profits.
Howard A Treesong wrote: It doesn't sound disastrous though, it's not going to be a huge drop in profits, just another decline they'll bluster through. But they are still blaming the restructuring though. I wonder when that'll get old.
It'll get old when the interns overseeing the GW part of the portfolio at the big investment firms pass the report on up to drop GW's shares.
Herzlos wrote: 3% trade drop is more worrying, less people are buying from FLGS.
Could this be attributed from people leaving the hhhoby and selling their stuff on here/ebay/in person?
I think it's more likely because FLGS's can't stock as much stuff and other games are more tempting. GW's sales through 3rd parties are continuing to drop as more 3rd parties give up on GW. As the other companies are growing GW is getting less shelf space in more indies, with some dropping them entirely.
So it's definitely down to people leaving the HHHhobby, but I don't think much to do with the 2nd hand trade.
Herzlos wrote: 3% trade drop is more worrying, less people are buying from FLGS.
Could this be attributed from people leaving the hhhoby and selling their stuff on here/ebay/in person?
I think it's more likely because FLGS's can't stock as much stuff and other games are more tempting. GW's sales through 3rd parties are continuing to drop as more 3rd parties give up on GW. As the other companies are growing GW is getting less shelf space in more indies, with some dropping them entirely.
So it's definitely down to people leaving the HHHhobby, but I don't think much to do with the 2nd hand trade.
A lot of product is now Direct only even some formerly core product. New releases aside (and I'm not sure how many of those are available for Independents) there must be some issues with making up an order focusing on an ever narrowing product line.
Rayvon wrote: Seems pretty much standard for a UK based business in this climate, It shows nothing to worry about as far as I am concerned.
You're going to have to qualify that a lot.
Especially as you seem to be making some fairly fundamental assumptions based on no actual figures. Remember, last year, "broadly in line with management expectations" equated to double digit drops in revenue and profit.
Rayvon wrote: Seems pretty much standard for a UK based business in this climate, It shows nothing to worry about as far as I am concerned.
How do you explain the growth of, well, everyone else in the gaming industry (including Warlord/Perry/Mantic/Renedra who are all local to Nottingham)?
It is wise to make comparisons with similar size companies as well as those within the same field, if you are looking for greater accuracy when predicting financials I always find.
Rayvon wrote: Seems pretty much standard for a UK based business in this climate, It shows nothing to worry about as far as I am concerned.
How do you explain the growth of, well, everyone else in the gaming industry (including Warlord/Perry/Mantic/Renedra who are all local to Nottingham)?
It is wise to make comparisons with similar size companies as well as those within the same field, if you are looking for greater accuracy when predicting financials I always find.
Ok, so a few examples of companies you've compared GW to?
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Blacksails wrote: They used that 'Broadly in line with expectations' line last year didn't they?
Yep.
They clearly have a very pessimistic view of where they're headed.
Rayvon wrote: Seems pretty much standard for a UK based business in this climate, It shows nothing to worry about as far as I am concerned.
How do you explain the growth of, well, everyone else in the gaming industry (including Warlord/Perry/Mantic/Renedra who are all local to Nottingham)?
It is wise to make comparisons with similar size companies as well as those within the same field, if you are looking for greater accuracy when predicting financials I always find.
No, it is wise to look at the same field - GW is losing sales, those companies are gaining sales.... How well a similarly sized *rolls randomly* yachting supply company is doing has no bearing on how GW is doing.
Where do you think that those sales that GW are losing are going, hmmmm?
Could it possibly be that they are going to those same companies that you have decided it is not fair to compare against?
But GW has declared that market research is otiose in a niche industry - so they cannot look and see what the competition is doing to steal those sales from GW.
Rayvon wrote: Seems pretty much standard for a UK based business in this climate, It shows nothing to worry about as far as I am concerned.
How do you explain the growth of, well, everyone else in the gaming industry (including Warlord/Perry/Mantic/Renedra who are all local to Nottingham)?
It is wise to make comparisons with similar size companies as well as those within the same field, if you are looking for greater accuracy when predicting financials I always find.
Um.. the best comparison you'll get to GW's size is probably PP, and they seem to be doing very well for themselves with consistent new releases, improving quality of said releases and the kind of hype for their new releases that GW could only dream of since they don't try at all to generate excitement.
As far as I know PP are growing.
Looking at the same industry... the tabeltop gaming industry in North America was estimated to have doubled between 08 and.. 2013 I believe it was. In NA we have seen 10-20% growth year on year for about 5 years now.
Corvus Belli reported 75% growth 2 years straight (and I think something similar again recently with Operation Icestorm's runaway success) in the same years GW remained flat.
There is no way to spin it looking at the industry where GW is just in line with the market. The market is exploding right now and GW seem to be running the other way. Admittedly I can't speak for companies of the same size in nottingham outside of our industry, but I can't imagine that having much of an effect on the final numbers.
Predictions on revenue/profit compared to last year? Growth in core/website offset by stores and retail and non-core sounds like a wash to me. Plus, given the same line recycled from last year would lead me to believe it'll look similar to last years.
Here's a thought; if you blame your drop in profits on restructuring then STOP BLOODY RESTRUCTURING. Give us back stores that have space to game and hang out in, multiple staff who aren't afraid they will be fired if they don't reach a certain sales threshold and sort out your sodding pre-order strategy.
Venerate1 wrote: Here's a thought; if you blame your drop in profits on restructuring then STOP BLOODY RESTRUCTURING. Give us back stores that have space to game and hang out in, multiple staff who aren't afraid they will be fired if they don't reach a certain sales threshold and sort out your sodding pre-order strategy.
Basically rewind ten years. Simples.
But that would require another restructure
I love how every year you read this, there's always "One off Costs" or "Restructuring Costs". At least as far back as 2008/09 I'm sure I've read that statement in some form. Are we sure they and they're not just the general cost of doing business?
Rayvon wrote: Seems pretty much standard for a UK based business in this climate, It shows nothing to worry about as far as I am concerned.
How do you explain the growth of, well, everyone else in the gaming industry (including Warlord/Perry/Mantic/Renedra who are all local to Nottingham)?
It is wise to make comparisons with similar size companies as well as those within the same field, if you are looking for greater accuracy when predicting financials I always find.
It depends on the field. In the niche luxury market for injection moulded toy soldiers, you'll find a more useful comparison with a smaller company that makes niche luxury toy soldiers with the same materials in the same ways, than you would, say a window or tractor part manufacturer with a similar turnover. At least in terms of how the current climate has hit the market.
It's also worth noting that during the worst of the recession, GW itself claimed to be recession proof because escapism sales increase in a recession, so even they don't think the economy is the problem.
I find it odd that they're still looking at restructuring costs as a source of bringing profits down. The changes made have been in place for almost 8 financial quarters now so the shifts that they cause in the financials should have been worked out by now.
The only thing that I can think of is that they are still paying rents on spaces that they abandoned due to lease agreements but the costs should have been absorbed in the same fiscal year in which they occurred, not a recurring cost unless GW companies pursue some weird form of GAAP that I've never heard.
More likely the retail chain has become a burden on the company to maintain due to the limitations created by the transition to one-man operations located in cheap rent areas. Locating your retail arm off the beaten path and closed for business during regular hours leads to reduced sales; anyone with a marketing background could have told them this before they did it.
lol, people saying it's not that big a deal are missing a major point. These are down.. from a baseline that had already plummeted like a stone in a lake. They've lost a limb previously and now they're losing fingers and toes.. it doesn't mean they got the limb back!
They are aggressively pursuing new releases because new releases were what was moving the most. So like [MOD EDIT - please find a different way to express yourself - Alpharius], they've decided that flooding the market with new releases must be the answer. It shows that truly, they see us as a cow that they can just keep milking rather than customers, hobbyists, and people who invest the limited resources we have into a hobby. Previously the storyline, setting, aesthetic, rules, community, and tournament scene were great to be a part of. Then, around the time Jarvis stepped up, Gav and Andy stepped out, and GW went public, it all went pear shaped.
I would like to see the number too but at this point it feels like watching a family member who you have fond memories of succumb to cancer. It's really a shame.
Rayvon wrote: Seems pretty much standard for a UK based business in this climate, It shows nothing to worry about as far as I am concerned.
How do you explain the growth of, well, everyone else in the gaming industry (including Warlord/Perry/Mantic/Renedra who are all local to Nottingham)?
It is wise to make comparisons with similar size companies as well as those within the same field, if you are looking for greater accuracy when predicting financials I always find.
Then I suppose GW is immune to comparisons since there are no other companies in the UK their size in their specific field?
I suppose that's a good way to cut off discussion.
There is some validity to suggest comparing a retailer with other retailers, obviously comparing a medium sized games company to the oil industry might lead you up the wrong path for example.
Boots (a large chemist retail chain in the Uk) laid off 700 people today.
High streets shops are increasingly difficult to operate despite a generally positive economic outlook.
notprop wrote: There is some validity to suggest comparing a retailer with other retailers, obviously comparing a medium sized games company to the oil industry might lead you up the wrong path for example.
Boots (a large chemist retail chain in the Uk) laid off 700 people today.
High streets shops are increasingly difficult to operate despite a generally positive economic outlook.
That's ok, GW are cutting their High St operation to the very minimum while investing heavily in their online presence.
Now, now old chap don't under sell yourself; I'm sure the Learned Dr Kronk Kronkington (professor at large) could impart some vital kernel of knowledge that us lesser mortals might have missed...?
"The effect of these non-core activities and the continuing effects of unfavourable exchange rates mean that our reported sales are likely to show small declines in retail (c.5%) and trade (c.3%)."
This is Kirbyism for "We lost 5% of our sales due to various and sundry reasons that aren't associated with the PED >>1! Don't look behind the PED curtain!"
All "broadly in line with expectations " means is that their results weren't bad enough for them to be legally required to post a peofit warning. My money's on standstill profit and a reduction in turnover.
notprop wrote: I think that simile is in rather poor taste.
Also your timeline is way out.
You really felt my post was so bad that it warranted being reported? WOW, I didn't realize people were so hyper-sensitive. As I am an adult and am given to speak like one who is under the impression he is speaking to other adults, I tend to forget that some people need a filter for reality. It's strange that the simile of losing limbs or loved ones to cancer would be seen as so rude though when we're discussing a company whose games commonly feature graphics that depict disembowelment, demonic possession, mutilation, genocide, and many other horrific things. While I do sense that my "impolite" post was only flagged because it is anti-GW, I will in fact refrain from posting any more similes that might be received in such a manner.
However, I do not support or condone GW's policies over the last decade or so.. so if reporting my post was merely meant to silence the GW dissenters, no.. I will not refrain from that, not until such a time as we see the hobby restored to it's former glory.
FYI - My adopted mother is a cancer survivor and my biological father died of cancer when I was a teenager and my wife has had cysts detected that are under observation. If I can stomach that type of simile, then I would think most people would be able to.
Osbad wrote: All "broadly in line with expectations " means is that their results weren't bad enough for them to be legally required to post a peofit warning. My money's on standstill profit and a reduction in turnover.
On July 28th, I suspect we'll see something like this:
However this is great news. GW as a company are committed to bringing the public the highest quality models in the industry. Price points have been carefully set to reflect that Citadel miniatures are the highest quality offerings on the market, and are fairly priced based on the untold hours of enjoyment that hobby enthusiasts will gain through their purchase. Over the last fiscal year, Games Workshop, as befitting their leadership position in the industry has invested in production initiatives which reflect on the bottom line as several one-time expenditures which will impact on this year's overall profits. Among these groundbreaking initiatives, Games Workshop is in the process of transitioning their entire product library to digital format. This has numerous obvious advantages as this will create an ironclad barrier against those miscreants who would seek to infringe upon our IP, as well as smooth production of new products by optimization of sprue layouts. We are excited to announce the last advantage to come out of this process. Our insiders know it as the "gribble-matic" where upon a computer software automatically adds detail from our extensive IP library to an existing base model. This drastically reduces the stagnant periods between codex updates and also saves untold man-hours and removes the cost of having an art department. As part of this process, we will be moving to a bi-annual codex update model in order to better supply the market demand for our hobby products.
Osbad wrote: All "broadly in line with expectations " means is that their results weren't bad enough for them to be legally required to post a peofit warning. My money's on standstill profit and a reduction in turnover.
On July 28th, I suspect we'll see something like this:
However this is great news. GW as a company are committed to bringing the public the highest quality models in the industry. Price points have been carefully set to reflect that Citadel miniatures are the highest quality offerings on the market, and are fairly priced based on the untold hours of enjoyment that hobby enthusiasts will gain through their purchase. Over the last fiscal year, Games Workshop, as befitting their leadership position in the industry has invested in production initiatives which reflect on the bottom line as several one-time expenditures which will impact on this year's overall profits. Among these groundbreaking initiatives, Games Workshop is in the process of transitioning their entire product library to digital format. This has numerous obvious advantages as this will create an ironclad barrier against those miscreants who would seek to infringe upon our IP, as well as smooth production of new products by optimization of sprue layouts. We are excited to announce the last advantage to come out of this process. Our insiders know it as the "gribble-matic" where upon a computer software automatically adds detail from our extensive IP library to an existing base model. This drastically reduces the stagnant periods between codex updates and also saves untold man-hours and removes the cost of having an art department. As part of this process, we will be moving to a bi-annual codex update model in order to better supply the market demand for our hobby products.
There are too few buzzwords in this report.
It also mentions the industry and markets Why? There is no industry! just GW's hobby! (obligatory trademark symbol).
If GW's sales have declined overall, but mail order sales have increased, doesn't the higher profit margin from mail order sales mean that fewer units were sold?
If GW's sales have declined overall, but mail order sales have increased, doesn't the higher profit margin from mail order sales mean that fewer units were sold?
That really depends on how they funnel the money around internally. It's only an assumption that mail order results in more profit overall... at least while they're still paying for the stores that are making progressively less money as more and more product shifts online.
It makes me wonder... are all of their one man stores profitable? Are they actually swallowing costs we don't think they are, even after all of the corner cutting, just to maintain the appearance of success? I really wish I had more of an education in international business because there have to be a lot of things taking their pound of flesh out of Games Workshop for them to lose profits without any major problems occurring. They're huge, they have stores everywhere, their IP is a household name, and their customers are battered housewives. How is it exactly that they're losing money?
Quarterdime wrote: It makes me wonder... are all of their one man stores profitable? Are they actually swallowing costs we don't think they are, even after all of the corner cutting, just to maintain the appearance of success? I really wish I had more of an education in international business because there have to be a lot of things taking their pound of flesh out of Games Workshop for them to lose profits without any major problems occurring. They're huge, they have stores everywhere, their IP is a household name, and their customers are battered housewives. How is it exactly that they're losing money?
My understanding is the stores generate something like 30% of GWs direct revenue but cost 60% of their overall revenue to stay open, so on the hard numbers they should be dropped. The reason GW haven't is because before they were one man stores in low rent areas they were all closer to what we would now consider a small battle bunker in very high foot traffic locations such as malls. During this time they served as GWs first and foremost form of advertising and they did it well. GW keep them around because they expect the same benefits from one man in a closit off a side road.
Quarterdime wrote: They're huge, they have stores everywhere, their IP is a household name, and their customers are battered housewives. How is it exactly that they're losing money?
They don't give their customers any advance warning about what they're releasing, their most popular releases are only made in limited quantities, they've been making it progressively harder to buy an ever-increasing chunk of their product range, and they stopped putting any effort into writing coherent rules as they try to shift from being a company that sells games to being a company that sells high-priced collectibles - that look like wargaming miniatures instead of high-priced collectibles.
Having said that, it's really easy to play armchair CEO and say ;Yeah, they could be doing so much better if they just did what I want them to do...' For all we know, maybe there are actually sensible reasons for their behaviour over the last few years.
I have a bad feeling about the new warhammer, gives me the same feeling they did many years ago with EPIC; They gutted the game after a few good versions in hopes of bumping up sales, With over simplifying rules and removing any and all the details from the previous versions of the game. After firing Robin Dews the game never recovered; I can already see it six months from now.. The new warhammer comes out ...game tanks in sales and because they have to meet market expectations; no more warhammer fantasy, I am sure a few upper brass will get fired.. But that will help with head count numbers...
Here is something to get everyone's attention for the financial year 2014/15 I have been told that GW has bled more than 12 million pounds that following the 11 million pounds of the financial year of 2013/14 that is a decline in sales of 23 million pounds in two years.
The Australian Market is expected to rack up a decline of sales of the order of 2 million pounds.
GW is in free fall and can't stop the slide. It is in trouble.
Achaylus72 wrote: Here is something to get everyone's attention for the financial year 2014/15 I have been told that GW has bled more than 12 million pounds that following the 11 million pounds of the financial year of 2013/14 that is a decline in sales of 23 million pounds in two years.
The Australian Market is expected to rack up a decline of sales of the order of 2 million pounds.
GW is in free fall and can't stop the slide. It is in trouble.
I don't find this hard to believe at all but I'll ask for a source none the less?
Achaylus72 wrote: Here is something to get everyone's attention for the financial year 2014/15 I have been told that GW has bled more than 12 million pounds that following the 11 million pounds of the financial year of 2013/14 that is a decline in sales of 23 million pounds in two years.
The Australian Market is expected to rack up a decline of sales of the order of 2 million pounds.
GW is in free fall and can't stop the slide. It is in trouble.
I don't find this hard to believe at all but I'll ask for a source none the less?
Ah, is it that time of year again where we all get back together, saunter to the edge of the fence, and continue to watch the horse corpse wither in the sunshine while a few of us take the 'ol bat out for a spin?
My favorite time of the year.
Also, I would have thought the vague flowery language would have been dropped with Kirby. Guess not.
If GW's sales have declined overall, but mail order sales have increased, doesn't the higher profit margin from mail order sales mean that fewer units were sold?
Sales and profits are different things.
If GW sell $100 through a shop, they make sales of $100. If the shop costs them $60 to operate and make that sale, their profit is $40.
If GW's webstore sells $100, it's sales of $100, but the profit might be $50 because the webstore only costs £50 to run to make that sale.
In either case the sales is still $100.
All figures have been made up for the sake of illustration.
Quarterdime wrote: They're huge, they have stores everywhere, their IP is a household name, and their customers are battered housewives. How is it exactly that they're losing money?
They don't give their customers any advance warning about what they're releasing, their most popular releases are only made in limited quantities, they've been making it progressively harder to buy an ever-increasing chunk of their product range, and they stopped putting any effort into writing coherent rules as they try to shift from being a company that sells games to being a company that sells high-priced collectibles - that look like wargaming miniatures instead of high-priced collectibles.
Having said that, it's really easy to play armchair CEO and say ;Yeah, they could be doing so much better if they just did what I want them to do...' For all we know, maybe there are actually sensible reasons for their behaviour over the last few years.
While it is easier in anything to be an "armchair expert" in anything - you are not that far off (I work with CEO's and help fix companies.....this one fits a pattern I have seen many times).
Clearly declining sales and profits are a sign you have a serious disconnect with your market - falling revenues are even more disastrous when have both increased new product introduction and raised prices - it means you are losing customers and they are buying less. Not a good place to be.
The really tragic part - is that their main problem is the both the easiest and most difficult to address - change management - the attitude of their leadership and the culture is has imbued in their company (go back and read a lot of their business reports and other published materials - its quite fascinating).
The amount of hubris in kirby's rambles is indicative of their core problem - they don't understand what people actually do with their beautiful models.
Awww! These GW annual reports are like waiting for Game of Thrones to get exciting. You always know that "winter is coming", but every year the story only seems to inch forward, just enough to keep you on tenterhooks. I'm just waiting for the year when the house of cards finally tumbles, Kirby gets eaten by dragons, and the corpses of disgruntled gamers finally rise-up, flinging themselves from the mile-high wall of prices to chow-down on the souls of wailing shareholders...
Smacks wrote: Awww! These GW annual reports are like waiting for Game of Thrones to get exciting. You always know that "winter is coming", but every year the story only seems to inch forward, just enough to keep you on tenterhooks. I'm just waiting for the year when the house of cards finally tumbles, Kirby gets eaten by dragons, and the corpses of disgruntled gamers finally rise-up, flinging themselves from the mile-high wall of prices to chow-down on the souls of wailing shareholders...
Maybe next season.
If anything, I doubt we'll see a huge collapse. It'll be death by a thousand cuts, which is kind of what we're seeing now. They'll whither and whither, store closures, price rises, market withdrawal, sales down, etc etc. continuing on for a few years. There's now too many games and systems out there that pull at the average gamers wallet. It'd be interesting to see what the UK club scene is like in terms of games played. I'd bet there'd be a good deal more variety than there used to be, especially with the X-Wing juggernaught alongside the other Star Wars games, DZC, CMON, Mantic, Warlord Games, Soda Pop, Inifinty, Spartan Games, Darklands, on and on. Fantasy in many ways represents one of their few last chances to re-rejuvenate sales. But, with a very competitive market for fantasy miniatures, it's going to be tough as they don't really have anything unique in terms of background any more, unlike 40k. When I look at WFB, I just see a grimdark mess. As an aside, has fantasy always been this Grimdark? I don't seem to remember it being so.
Kirby does not want to do any long term investment in the company, that is not the game plan.
Cannibalize assets as needed to ensure sufficient profits to roll-out dividends.
As long as he is still in a position to pay himself it will stay the course.
Once he cannot do that with some measure of certainty, he will leave.
That is around the same time portfolio minders will also lose interest and drop the stock.
Has any of his rambling stated some plan of "expansion" of any kind?
He is not giving a passing thought of GW's future other than his immediate needs.
Its my favourite time of year as seasoned business analysts do business with the ever thinner legion of white knights trying to explain that the story of the last few years is a slow motion train wreck while the white knights go nothing to see here people move along'.
My reading of this statement is that its setting the scene for some very bad news, which coming on the back pf several years of bad news. The company will npt have an 'end times'fallin one swoop, but it is increasingly struggling to adapt to a market that it doesnt understand. The excuses vary year on year, but if i were an investor at corporate level hearing the line about exchange rates (really because that is news to pretty much every other company out there in any kind of uk business), or staff (how long can they keep that one going), and restructuring (again, at some point i'd ask when the change bandwagon is over) then i would be getting very concerned now.
Fundamentally they need to realise that they've lost their market by simaltaneously annoying the old school hobbyists who are very loyal, and making it far too expensive for new entrants at a time when the market is more competitive than its ever been. Without a clue what their market is,they seem to think that there is an uncaring and unquestioning legion of buyers out there, who will buy until the end times.
If you look at the uk gaming scene over the last five years or so, its a story of masses of new and exciting systems and models. The days of GW being the only player in town are gone forever, and baring a massive change of direction (shutting the retail chain or mpving to franchise system) they are screwed. While people will say 'but they've said that for years',i dont think the companys financials have ever before shpwn over such a sustained period such a precipitous drop in income. It would be great if somone could do a graph showing what income has done in real terms for the last ten-fifteen years, as i sense this will show how bad it really is.
(Sorry for typos - am on ipad and have fat fingers!)
If this six month report is negative, it will be the fifth in a series of negative six month reports. In other words, two and a half years of falling sales.
Clearly that situation cannot go on for ever. Either GW will turn the corner, or the slow slide will suddenly become a fast slide down the pan.
The most worrying thing about each Chairman's preamble is that there is never any admission that there is a problem, or any ideas about what they are going to do to fix it. The fixes are purely financial; losing revenue? Reduce staff costs. There is no examination of why they are losing sales.
GW are not really known for being humble. Even Apple apologise when they've screwed up because they understand PR. GW haven't even acknowledged the problems with Finecast and still believe they were in the right over the CHS given Kirby's comments about how the legal system has been set up allowing people to steal their pigs or somesuch.
Smacks wrote:Awww! These GW annual reports are like waiting for Game of Thrones to get exciting. You always know that "winter is coming", but every year the story only seems to inch forward, just enough to keep you on tenterhooks. I'm just waiting for the year when the house of cards finally tumbles, Kirby gets eaten by dragons, and the corpses of disgruntled gamers finally rise-up, flinging themselves from the mile-high wall of prices to chow-down on the souls of wailing shareholders...
Maybe next season.
I'd be happy with a Red Board Meeting.
(And I might also spare a snigger for the reactions of the fans who never saw it coming and go 110% binky-bonkers over it)
Awww! These GW annual reports are like waiting for Game of Thrones to get exciting. You always know that "winter is coming", but every year the story only seems to inch forward, just enough to keep you on tenterhooks. I'm just waiting for the year when the house of cards finally tumbles, Kirby gets eaten by dragons, and the corpses of disgruntled gamers finally rise-up, flinging themselves from the mile-high wall of prices to chow-down on the souls of wailing shareholders...
This made my day !
More seriously, I fail to understand why GW is not trying to change its way and also why they keep going while they have an obvious issue with sales & profits. I guess it's some kind of biased organisational behavior that blind them, like it had happened so many times in History, Idk.
Financial reports seems bad (I'm not a marketing expert or a financial analyst but still) and erveryone in here seems to agree on that. Then I wonder if we are missing a point and GW actually have hidden ways to survive (exterior investments, Idk?) or if we are really witnessing its decline? How can such a company survive so long with so bad results, that's what I want to figure out?
Tom Kirby is the largest non-institutional investor, by quite a margin. He is a few years from retirement and he is not running the company for long term growth and success but as a short term method of generating cash.
Possibly he feels entitled because he "saved" GW by taking it public back in the day, I don't know, but if you view the last few years through the prism of someone doing their utmost to extract as much cash as possible with no concern for how grievously wounded they leave the company when they walk away, a lot of stuff starts to make a lot more sense.
GWhas been trying to change their ways. The trouble is they have been going in directions that a significant number of players dislike -- IMO -- leading to falling sales.
The reason why they have survived so far despite is that they are still making a profit, partly due to cost reductions.
Their problem is that if their sales keep on falling, they can't go on reducing costs for ever, and at some point the profit turns into loss and then everything will fall apart quickly.
Possibly he feels entitled because he "saved" GW by taking it public back in the day, I don't know, but if you view the last few years through the prism of someone doing their utmost to extract as much cash as possible with no concern for how grievously wounded they leave the company when they walk away, a lot of stuff starts to make a lot more sense.
Then I guess it's the result of bad influence of shareholders at top level? Plus they have been "falling" from quite a few years and they seems to be more productive than ever regarding releases etc...
Kilkrazy wrote: If this six month report is negative, it will be the fifth in a series of negative six month reports. In other words, two and a half years of falling sales.
Clearly that situation cannot go on for ever. Either GW will turn the corner, or the slow slide will suddenly become a fast slide down the pan.
The most worrying thing about each Chairman's preamble is that there is never any admission that there is a problem, or any ideas about what they are going to do to fix it. The fixes are purely financial; losing revenue? Reduce staff costs. There is no examination of why they are losing sales.
Bingo. Give this man a cigar.
While it's true that most companies try to spin the negative to appear less than it actually is, the difference with GW is that the Board and CEO fail to even admit there is trouble. They attempt to apply a little handwavium (tm) and just say that the negative numbers are due to exchange rates or the restructuring of their retail stores which benefit from being a partial truth. If you scratch the surface of the reports though, you realize that GW is a company in serious decline, nearly Radio Shack levels of decline and management is strumming the proverbial fiddle while Rome burns around their ears. When this all started, they benefited from some real cost-cutting measures, doing things that really needed to be done but as time went on, they trimmed the fat and kept cutting into the bone, reducing their retail arm to a shadow of its former self and unable to compete with even local FLGSs.
What was their answer to financial distress? Throw gack at the wall and see what sticks; out came rapid releases of products that enthusiasts have been crying out for years to get their hands on (knights, skitarii, warlord titan, etc.) but I would hazard a guess that it's too little, too late. Many collectors have left due to the previous glacial release cycle and many more gamers have left due to the confusing mish-mash of rules, frequent invalidation of army books (requiring further book purchases) and the sorry state of the game as a whole. They're unable to attract new custom due to their stores being relocated to shady areas, under bridges (every time I cross the bridge, the GW troll comes out and tries to sell me a $20 miniature) and a price point that is extortionately high when compared to the competition. The company performs no advertising outside of their own magazine and no marketing of any stripe and so depends on word of mouth to attract new customers; and now word of mouth is overwhelmingly "stay away."
So, no, GW management has no idea why things are bad; undoubtedly they know it's bad though. I wonder what became of that Customer Experience position that they posted last year; if that person is happily traveling the world, being mugged in dark alleys to reach the GW store in the back corners of the cities in which they are located, and whether this person will report the truth, that customers are not happy and are voting with their wallets or simply toe the company line and say, "everything is awesome." (earwig, now you're going to be singing that song all day)
I will say that Kirby is the only reason the company has lasted this long, on the course that they've taken. I think that they would have fallen ingloriously years ago if he hadn't come and trimmed the corporate fat (and their was some) but he simply didn't know when to stop and hand the reins over to someone who could construct a leaner but creative and advancing corporate structure and philosophy. This is the problem with incestuous companies like GW who don't look outside themselves for new ideas to stay fresh and relevant.
Quarterdime wrote: They're huge, they have stores everywhere, their IP is a household name....
1. They're only "huge" relative to other tabletop miniature game makers.
2. They have stores everywhere in the UK, and that's about it.
3. No, it's not. If you're not already a tabletop gamer, you've probably never heard of Games Workshop or any of it's affiliates. I'd honestly be surprised if, outside of the UK, more than 5-10% of households have a single member who would recognize the Games Workshop name.
The fact of the matter is that they're the manufacturer of a niche, luxury item that caters to a very small market relative to the market as a whole.
It's kind of a household name, for certain households. Like I imagine a pretty high percentage of 30-50 year old guys in the UK "used to play that warhammer" from when it was a high street name (as in, you could buy 40K/HeroQuest/BloodBowl in most towns). For their target market? Not so much.
Kilkrazy wrote: If this six month report is negative, it will be the fifth in a series of negative six month reports. In other words, two and a half years of falling sales.
Almost certainly a lot longer than that by several years, its only recently that GW's revenues have been falling faster than their regular price rises could mask.
Im assuming we've attributed the potentially poor performance of the last 6 months to a year because of the drop off in LotR and the implosion of Fantasy.
I'd be shocked if fantasy sales reached any sort of threshold since pre Xmas due to the end times acomming.
Hence would it not be better to judge next years performance when Fantasy gets a reboot, the last of the 40k codicies get updated and released and any new stand alone games come out?
Its a bit hard to judge GW when two of their major lines of the last 10 years have effectively stopped being supported/made sales, leaving only 40k to fly the flag.
Ratius wrote: Im assuming we've attributed the potentially poor performance of the last 6 months to a year because of the drop off in LotR and the implosion of Fantasy.
I'd be shocked if fantasy sales reached any sort of threshold since pre Xmas due to the end times acomming.
Hence would it not be better to judge next years performance when Fantasy gets a reboot, the last of the 40k codicies get updated and released and any new stand alone games come out?
Its a bit hard to judge GW when two of their major lines of the last 10 years have effectively stopped being supported/made sales, leaving only 40k to fly the flag.
I don't think the LOTR sales are impacting that much. If there's one thing I've learned over the years, the LOTR fans are a loyal bunch - there will always be a market for LOTR models. I think GW could sell them for a while longer.
The loss of money isnt as important as the loss of players. (Although i wouldnt surprised at all if the 4mil website designation was so high because they wanted to make and excuse for a drop off in online purchasing)
This is GW's MO really...
Warhammer online: made more than enough money to survive... couldnt keep players in game due to bugs/terrible patches/no improvement of rules. Axed when player pool dwindled to low.
Dawn of war (all of them): made more than enough money to survive... couldnt keep players interested due to bugs/terrible patches/no improvement of rules. Axed when player pool dwindled to low.
Specialist games (BFG, EPIC, necromunda, inquisitor, blood bowl, etc: made more than enough money to survive... couldnt keep players in game due to bugs/terrible patches/no improvement of rules. Axed when player pool dwindled to low.
Hobbit: made more than enough money to survive... couldnt keep players in game due to bugs/terrible patches/no improvement of rules. Axed when player pool dwindled to low.
warhammer fantasy: made more than enough money to survive... couldnt keep players in game due to bugs/terrible patches/no improvement of rules. soon to be axed when player pool dwindles to low.
The plain and simple fact is that whereas for the past 10-20 years the people playing the game were the primary advertisers... now most of us dont even try to sell the game to fresh blood.
this game is like golf without any of the positive stereotypes: expensive, time consuming, most of peoples enjoyment is derived from thinking about it rather than actually experiencing it. Wargaming in general is viewed as childish and archaic, and generally a negative light by most of the modern world, and thats a hard stigma to overcome just to get abused fiscally by the same company that adult society mocks you for enjoying.
EDIT:
1. i know that the vidja games arnt necessarily in GW's control... but they were the owners of the IP. And greenlit the developers who were to blame
2. most of the specialist games were fairly solid, holistically.
Ratius wrote: Im assuming we've attributed the potentially poor performance of the last 6 months to a year because of the drop off in LotR and the implosion of Fantasy.
I'd be shocked if fantasy sales reached any sort of threshold since pre Xmas due to the end times acomming.
Hence would it not be better to judge next years performance when Fantasy gets a reboot, the last of the 40k codicies get updated and released and any new stand alone games come out?
Its a bit hard to judge GW when two of their major lines of the last 10 years have effectively stopped being supported/made sales, leaving only 40k to fly the flag.
Why white knight it?
Anyone with half a functioning brain stem could read the paper and see the last of the LotR movies was coming out and plan in advance that their would be a drop off in LotR sales. Further, a 5th grader should be able to read sales statements and see an impending implosion in fantasy sales. While GW has said they don't do market research they presumably do look at the data they have in house and can at least act upon it.
Every six months its "well these don't show the sales from Codex X, or 40K reboot Y, or obviously show onetime decline in product Z." At some point they stop being inconvenient aberrations to the bottom line and become indicative the inability of management to plan for obvious and foreseeable circumstances.
If you lived in a tent held up by three solid foundational poles, would you find it acceptable when it was discovered that one of the poles was actually so rotten to the core that it no longer had any structural worth and the third pole, that you actually borrowed from someone else, was due to be returned with no replacement in site?
As a consumer it is easy to judge GW. They offer me nothing of value. There is a large and growing majority that agrees that GW no longer offers products of value. I am certain that GW is aware of this growing sentiment in their customer base, however as a publicly traded company they will continue to confuse and obfuscate the issue because it isn't the customer that needs to be appeased, it is the investor. That will continue as long as they can mask falling sales with marginal profits.
The public exclaim from on-top is very confusing when they claim to be "only" a model company.
Never mind comments of being a "Ferrari", I basically devolve into cost / value comparison below of how they conflict with various interests and invariably lose.
It is said by Kirby they are a high end collectable model manufacturer, done, fini.
Did some searches of the "best" models and found this "Supermarine Spitfire", they even provide masking for the canopies.
http://www.hyperscale.com/2009/reviews/kits/tamiya60319reviewbg_1.htm $107 at Amazon Canadian funds.
Closest cost equivalent in a single model is the Tau "Riptide" for $100. No comparison.
Yet they sell books of various rules for up to 3 times what a high end graphic novel would cost.
(Here, supposedly "Batman: The Dark Knight Returns" Deluxe edition, hardcover $34.99, I had to reference this one because they are selling it "worse" than the original... in black and white!!!!)
http://www.dccomics.com/graphic-novels/batman-noir-the-dark-knight-returns-deluxe-edition
Their paint costs more than a mouthful of high end scotch ($5 for 0.4 of an oz US = $12.50 per oz).
Their individual unassembled models are almost at par in cost with X-wing fully assembled, fully painted models with cards, tokens and stands.
Any one of their craft tools costs more than a 15 piece set at the local hardware store (Verified "detail cutters" at $40 and kit at Canadian Tire).
So the line of "we do no market research" comes into play of where the competition for all those dollars to buy their models: when does their apparent "worth" bring them to the front of the purchasing cue? I am more a "gamer" so if there is less game to be had for those fine models, their apparent worth (is) less.
If GW's sales have declined overall, but mail order sales have increased, doesn't the higher profit margin from mail order sales mean that fewer units were sold?
Sales and profits are different things.
If GW sell $100 through a shop, they make sales of $100. If the shop costs them $60 to operate and make that sale, their profit is $40.
If GW's webstore sells $100, it's sales of $100, but the profit might be $50 because the webstore only costs £50 to run to make that sale.
In either case the sales is still $100.
All figures have been made up for the sake of illustration.
Obviously. I wasn't sure if the blurb was referring to "sales" in the sense of revenue, or if GW was referring to profits. There might be rules that dictate what such words mean in that context.
You would think that if GW's profitability went up, the company would have touted that in the press release. So if it is the case that mail order revenue has cannibalized trade revenue, wouldn't GW have a higher profit margin on the cannibalized revenue?
That's a gross oversimplification, of course. I'm just spitballing.
Specialist games (BFG, EPIC, necromunda, inquisitor, blood bowl, etc: made more than enough money to survive... couldnt keep players in game due to bugs/terrible patches/no improvement of rules. Axed when player pool dwindled to low.
Welcome, traveller! Once your biological functions have aligned to this dimension's physical laws, we'll show you how the SG were actually good on this side of the void.
Specialist games (BFG, EPIC, necromunda, inquisitor, blood bowl, etc: made more than enough money to survive... couldnt keep players in game due to bugs/terrible patches/no improvement of rules. Axed when player pool dwindled to low.
Welcome, traveller! Once your biological functions have aligned to this dimension's physical laws, we'll show you how the SG were actually good on this side of the void.
Agreed. Epic and BFG needed rule improvements? Bloodbowl, really? Maybe they needed the odd quirk or rule FAQ'd (which was produced quite regularly) but a re-write? Hardly. But, I see what point you were trying to make. Sorry for the derailment!
Blood Bowl did need fixing. In particular, they needed to get rid of the bloody stupid idea that it's a good thing if some teams are flat out better than others. Liking the idea of a Halfling team does not mean you should not get to win games - if you don't want to win games, you are more than capable of setting your own handicap to achieve that without the developer stacking the deck against you.
Specialist games (BFG, EPIC, necromunda, inquisitor, blood bowl, etc: made more than enough money to survive... couldnt keep players in game due to bugs/terrible patches/no improvement of rules. Axed when player pool dwindled to low.
Welcome, traveller! Once your biological functions have aligned to this dimension's physical laws, we'll show you how the SG were actually good on this side of the void.
Agreed. Epic and BFG needed rule improvements? Bloodbowl, really? Maybe they needed the odd quirk or rule FAQ'd (which was produced quite regularly) but a re-write? Hardly. But, I see what point you were trying to make. Sorry for the derailment!
^^ What these two fine gentlemen said. Also, the DOW series didn't get axed because of losing players/bad support, it was discontinued because THQ, which owned the developer Relic, went bankrupt and its projects were auctioned/dissolved.
That being said, the basic point that GW has not made an effort or lifted a finger to support anything except their two flagship lines is quite true, and I feel like the increasing lack of entry-level GW games really hurt their influx of new players over the last 5 years.
OT: These threads get me so excited; the GoT/TV Drama analogy was very apt.
OT: These threads get me so excited; the GoT/TV Drama analogy was very apt.
It's why I like watching The Apprentice, too. You get the feeling that, while you're definitely no business guru yourself (or... myself, even), you could hardly miss the fundamental principles in the way this pack of jokers do.
If GW's sales have declined overall, but mail order sales have increased, doesn't the higher profit margin from mail order sales mean that fewer units were sold?
Sales and profits are different things.
... ... ...
Obviously. I wasn't sure if the blurb was referring to "sales" in the sense of revenue, or if GW was referring to profits. There might be rules that dictate what such words mean in that context.
Accounting terminology is controlled by rules founded in law.
weeble1000 wrote:You would think that if GW's profitability went up, the company would have touted that in the press release. So if it is the case that mail order revenue has cannibalized trade revenue, wouldn't GW have a higher profit margin on the cannibalized revenue?
That's a gross oversimplification, of course. I'm just spitballing.
If cannibalisation of retail sales by webstore increased profits, you might expect them to shout out that good news indeed. It might not be effective though in terms of the distribution sales.
It actually is possible that sales through independents would be more profitable than sales through GW's own outlets whether high street or web, because while the selling price of each unit is lower, there are no additional costs involved.
Agreed with the quoted posts about my specialist games and vodka games points. (as shown at the bottom of the post yall didn't get to because you were triggered already)
Bloodbowl went up to six editions, by which time the rules were maintained by an enthusiastic committee of players and members of GW's own design studio, available online as the Living Rulebook. By all accounts it was a pretty tight rulebook by the end.
Some of these committee members were the guys whose fan web sites GW then proceeded to gak on for having names like Bloodbowl.com, and so on.
Kilkrazy wrote: If this six month report is negative, it will be the fifth in a series of negative six month reports. In other words, two and a half years of falling sales.
Almost certainly a lot longer than that by several years, its only recently that GW's revenues have been falling faster than their regular price rises could mask.
I totally agree. It is pretty clear that unit sales have been dropping for at least five years if not longer, but rapidly rising prices concealed the problem.
However if we are looking at financial reports we have to look at the figures presented which are naturally money amounts.
AlexHolker wrote: Blood Bowl did need fixing. In particular, they needed to get rid of the bloody stupid idea that it's a good thing if some teams are flat out better than others. Liking the idea of a Halfling team does not mean you should not get to win games - if you don't want to win games, you are more than capable of setting your own handicap to achieve that without the developer stacking the deck against you.
Then don't play them, some of us do quite well with them. Blood Bowl was a solid rule set and it had nothing to do with GW. In fact GW is why the system isn't even better then it already is they actively made it worse. As a world wide community playtested the rules headed by a group of fans, and got a free rulebook made for them. Fluff and all.
It seems we all agree that the rules improvements of blood bowl came after corporate axed its support, and a few diehard developers took it upon themself to tighten the rules as a pet project once the company interference was removed? At least that's the point I was making, and that by then the vast majority of the player pool had already burned out or lost interest.
Sorry for the derailment on that, but it is relevant in the same way that GW mishandles its constituency currently. I don't think it's any stretch to say that most fantasy sales are to people who are already invested to some degree; and round bases, unknown new rules, wild speculation, changing of the races, etc are all changes that inconvenience players proportionally to how invested they already are (I might not mind having to go back and round base 500 points worth of stuff, it's just not worth it for me to do that to my 4.5k combined chaos force).
AlexHolker wrote: Blood Bowl did need fixing. In particular, they needed to get rid of the bloody stupid idea that it's a good thing if some teams are flat out better than others. Liking the idea of a Halfling team does not mean you should not get to win games - if you don't want to win games, you are more than capable of setting your own handicap to achieve that without the developer stacking the deck against you.
Sounds quite a bit like the state of 40k these days...
Its a bit hard to judge GW when two of their major lines of the last 10 years have effectively stopped being supported/made sales, leaving only 40k to fly the flag.
It's actually quite easy to judge GW because if the two lines stumbled then it was due to GW's making. People don't just buy stuff because of a GW sticker on the box. There might be some outside problems that could cause a drop in sales but I don't really see an iPhone hitting Blackberry situation for GW here (with them being Blackberry in this case). They are a company and need to manage their product output and balance sheet so if there is a sudden drop for no real reason then they are the only one to blame. Other options (for blame) would be some competition but I don't really see anyone who could influence them to such a high degree is such a short time or the consumer. But how do you blame consumer for just not buying something? That would be ridiculous so the only real option (in my opinion) would be GW having done it themselves (probably unintentionally).
I think GW is a MAJOR acquisition target. Declining sales numbers. closing stores. "Archaic" and "fringe" pursuit. Significant new entrants to the industry. Mantic snd Privateer mainly.
What they have: Major IP asset. Loyal fanbase. Great Creative department.
What they need. Social Media footprint. Strategic Partnerships including a REAL movie studio or Netflix partnership (major US), a real video game partnership (major US). Game balance. Corporate recognition that it is FIRST a content creator. SECOND a game company. THIRD a miniature manufacturer. Not vice versa.
Until a true SWAT analysis is made, this corporate team is going to see continuing declines until it is bought by a visionless conglomerate that will spin it off.
Wasn't there some debacle over the 6th edition of the Bloodbowl living rulebook where GW decided they didn't want to cooperate with them releasing it with rules for star players and things and made them gut it before release? Then to show exactly what they thought of the player base they started throwing C&Ds at various sites related to Bloodbowl.
Howard A Treesong wrote: Wasn't there some debacle over the 6th edition of the Bloodbowl living rulebook where GW decided they didn't want to cooperate with them releasing it with rules for star players and things and made them gut it before release? Then to show exactly what they thought of the player base they started throwing C&Ds at various sites related to Bloodbowl.
Yep. GW does like to attack loyal fans while standing imotently aside as competitors treat them better and steal them away.
Howard A Treesong wrote: Wasn't there some debacle over the 6th edition of the Bloodbowl living rulebook where GW decided they didn't want to cooperate with them releasing it with rules for star players and things and made them gut it before release? Then to show exactly what they thought of the player base they started throwing C&Ds at various sites related to Bloodbowl.
Yeah, GW noticed that there was a thriving third-party market, and so just removed any of the Star Players that lacked models from the game.
The C&Ds were slightly unrelated... That happened around the time the Bloodbowl computer game was in the works. They started hitting up any fansite that used their IP in the domain name, in case they wanted to use that name themselves to promote the computer game. Technically well within their rights, but still a gakky thing to do to sites that had been putting in all the work to keep the game alive that GW clearly had no interest in doing themselves.
A properly scaled 40k back down to Epic and then making the main game into Infinity would be great at this point, but I doubt that's going to happen. 28mm 40k right now is just a hot mess of random rules, junk codecis being thrown out, and a lot of fan service at mile high costs.
Plus, whatever is happening to Fantasy.
Keep spiraling around the drain a bit longer, it seems.
Ratius wrote: Its a bit hard to judge GW when two of their major lines of the last 10 years have effectively stopped being supported/made sales, leaving only 40k to fly the flag.
LOL, what? I assume you're being sarcastic because that is crazy.
If WHFB sales have dropped off, it's entirely because GW are stupid for ending the End Times and leaving customers hanging. Of course we can judge them on that, it's just those kind of stupid things they should be judged on.
As for the Hobbit, GW had only put in a token effort to support The Hobbit right from the moment Escape From Goblin Town sold so poorly. Instead of getting a boost in sales from the last film being released I'm sure all they got was a bunch of customers saying "WTF? Why is it all resin and priced as if it were made from gold?".
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doktor_g wrote: What they have: Major IP asset. Loyal fanbase. Great Creative department.
I think the 40k IP is over rated. It's big in the context of a wargame, but it's small in the context of many other IP's. Firstly, a recent 40k poll would suggest there's not much more than 120k active 40k customers globally and I'm sure many of those come from GW's wide array of stores which are costing a fortune to keep open. Secondly, GW have already expanded 40k to the nth degree, any new company that picks it up will be left wondering "err, what do we do with this now?". I'd suggest many companies would rather have the IP for a movie or maybe even a book or video game than for 40k.
Specialists games were just a money pit for GW, That they were entry games and gotta a lot of love from the Veterans was not relevant, need to reduce costs away Specialist games went!
Jehan-reznor wrote: Specialists games were just a money pit for GW, That they were entry games and gotta a lot of love from the Veterans was not relevant, need to reduce costs away Specialist games went!
No, they weren't. All the SG's were profitable to some extent. They were axed because of the move away from metal and, I reckon, GW erroneously believed that all the SG buyers would move over to the main games. Well, the cancellation of the Specialist Games has allowed myriad competitors to spring up filling that niche quite nicely.
TheKbob wrote: A properly scaled 40k back down to Epic and then making the main game into Infinity would be great at this point, but I doubt that's going to happen. 28mm 40k right now is just a hot mess of random rules, junk codecis being thrown out, and a lot of fan service at mile high costs.
This is what needs to happen but of course it won't until the entire company melts down. A revamped 40K 2nd ed would be perfect, ironically the 2nd ed rules were simpler than the hideous mess that 40k is today. I would also be worried about GW meddling with Epic given that all that is really required is some updated official army lists and models.
Were they? Given that smaller companies can survive and thrive of the back of similar games I don't see how they could have been losing GW money if they had been managed correctly. The reason why 'Specialist' games are still being played over a decade after GW abandoned them is that they are, on the whole, quality rulesets that reach the gaming nirvana of simple rules+complex gameplay.
I think it is indicative of GW's cackhandedness they they were allowed to die in the first place.
Firstly, a recent 40k poll would suggest there's not much more than 120k active 40k customers globally.......
Thats a pretty strong conclusion to draw from a self selective poll with under 3k respondents. I doubt that anyone really knows just how many people play 40K, not even GW. The 40K IP is strong, it is just about a household name and most if not all young males (<30) in the west will have heard of it (probably)
Thats a pretty strong conclusion to draw from a self selective poll with under 3k respondents. I doubt that anyone really knows just how many people play 40K, not even GW. The 40K IP is strong, it is just about a household name and most if not all young males (<30) in the west will have heard of it (probably)
I really don't think so. 'Almost a household name' is really stretching it. This is a niche hobby. It might be more well known (or less well unknown) in the uk, but 'the west' is stretching it.
Thats a pretty strong conclusion to draw from a self selective poll with under 3k respondents. I doubt that anyone really knows just how many people play 40K, not even GW. The 40K IP is strong, it is just about a household name and most if not all young males (<30) in the west will have heard of it (probably)
I really don't think so. 'Almost a household name' is really stretching it. This is a niche hobby. It might be more well known (or less well unknown) in the uk, but 'the west' is stretching it.
This. The amount of people that I had to explain to what miniature wargaming was (let alone Warhammer) who came into the game store I worked at was astounding. And this was a destination store, not a mall location. Amongst a certain subset of geeks it's a familiar name, but after the 90s when GW stopped advertising in the different gaming rags (I remember seeing them all the time in my Dragon subscription) their name recognition dropped rather heavily.
Jehan-reznor wrote: Specialists games were just a money pit for GW, That they were entry games and gotta a lot of love from the Veterans was not relevant, need to reduce costs away Specialist games went!
No, they weren't. All the SG's were profitable to some extent. They were axed because of the move away from metal and, I reckon, GW erroneously believed that all the SG buyers would move over to the main games. Well, the cancellation of the Specialist Games has allowed myriad competitors to spring up filling that niche quite nicely.
Maybe i phrased that wrong IMHOGW management thought it gave not enough return, that there were other benefits to these games didn't enter the equation.
Yeah I think the issue was that they would make a bigger return on other things, and just assumed that they cannibalized sales from the big lines and that dropping them would move people over to WHF/40K.
In reality, dropping them moved people over to Dreadball, Dungeonball, Guildball, Dropzone Commander, Infinity, Malifaux, and so on.
I think they've also stopped caring about anything that doesn't result in a immediate direct profit (good will, customer retention). Presumably because Kirby is about to retire and doesn't care about the long term as much as he does about his dividends.
Shotgun wrote: While GW has said they don't do market research they presumably do look at the data they have in house and can at least act upon it.
I don't know if they even do that. Obviously, we can't look at their volume of sales, but if we were to assume that a space marine tac squad is representative of their products (in fairness space marines are probably their best selling product), and we compare sales revenue divided by their price over the last two years, we get something like this.
2013: 5.8 million units sold. 2014: 4.9 million units sold.
If we cross reference that with the £2 increase in price since 2013, we get a price elasticity of about 1.78. Which would suggest the optimum price for a tactical squad (I.e. the price that would maximise their own revenue) would be around £16.00 ($25).
This actually sounds about right to me personally, and If we compare that figure with the dakka survey on a reasonable price for a tac squad, we can see that $25 is just slightly in front of the mode, which is where it aught to be. So even though this is only a crude estimate, it is at least corroborated quite nicely by the survey.
Any economist would be able to tell this stuff from their figures. Yet GW bring out the new BAtac squad, and slap £26 on it... The only issue I can see is that customers (especially in the past) have tended to finish armies and eat the price hikes for many months before they finally stop buying. So there might be quite a lag period between GW raising prices and feeling the effect. If this wasn't accounted for then they might mistakenly believe that they can just keep raising prices forever, and people will keep eating it indefinitely. Sadly, that actually seems to be exactly what they think, which just shows how out of touch they are with their customers, and reality.
Of course, I'm making the assumption here that the dip in sales is solely due to price. GW seem to assume price is no object, and that sales are dipping because of other factors, for example they have blamed computer games, and recently the economy. I guess that could still be true, but everyone I know who has quit GW (and that is now everyone that I know, that ever played GW), they all quit for the same reason: prices got too high.
Thats a pretty strong conclusion to draw from a self selective poll with under 3k respondents. I doubt that anyone really knows just how many people play 40K, not even GW. The 40K IP is strong, it is just about a household name and most if not all young males (<30) in the west will have heard of it (probably)
I really don't think so. 'Almost a household name' is really stretching it. This is a niche hobby. It might be more well known (or less well unknown) in the uk, but 'the west' is stretching it.
I could definitely believe it's well known in the UK though I haven't been there to know for sure, they have the highest density of GW stores per head of population and also land mass.
Over the rest of the world, I don't really think so.
Also I don't disagree that it's a strong conclusion, which is why I used the wording "would suggest" rather "shows conclusively". I'm open to new data showing better figures, but at this point it's the best we have and 3k respondents I would say is actually pretty high in the context of a wargame, if my estimate was right it would be about 2.5% of the total population or about 1 in 40 gamers.
I could definitely believe it's well known in the UK though I haven't been there to know for sure, they have the highest density of GW stores per head of population and also land mass.
Over the rest of the world, I don't really think so.
Also I don't disagree that it's a strong conclusion, which is why I used the wording "would suggest" rather "shows conclusively". I'm open to new data showing better figures, but at this point it's the best we have and 3k respondents I would say is actually pretty high in the context of a wargame, if my estimate was right it would be about 2.5% of the total population or about 1 in 40 gamers.
It's kind of a 'British thing' I suppose - more people than you realise would be familiar with it, but I wouldn't go so far as to call it a household name. A lot of guys wIll have a box of 'warhammers' somewhere in their attic from when they were kids, and their sisters might remember their brothers playing with them when they were kids, but I think it's of a certain generation- those of us who were kids in the 80s and 90s more so than thr current generation. Press them on it and they might remember them, but as a general impression, I think far more people would know about world of Warcraft or Pokemon than things like warhammer or even mtg.
The pool of active wargamers is quite small. I think more people would be season ticket holders for any individual scottish championship football team than there would be active gamers.
Herzlos wrote: Yeah I think the issue was that they would make a bigger return on other things, and just assumed that they cannibalized sales from the big lines and that dropping them would move people over to WHF/40K.
In reality, dropping them moved people over to Dreadball, Dungeonball, Guildball, Dropzone Commander, Infinity, Malifaux, and so on.
I think they've also stopped caring about anything that doesn't result in a immediate direct profit (good will, customer retention). Presumably because Kirby is about to retire and doesn't care about the long term as much as he does about his dividends.
Devil's Advocate - According to the internets, Kirby has been set to retire since 2006 and has only been worried about short term gains since then. Heck, if you could go back to www.portent.net, I'm sure you could find people using the same narrative against Kirby all the way back to the late 90's. How is GW being short minded? They took a huge hit by pushing out Internet retailers to support brick and mortar stores. They are pushing to support their business partners better. This is a long term strategy and has more direct impact on the Company's financial statements than cutting specialist games. If GW was being short minded and wanted to boost their short term sales, they would sell their product to anyone who could turn it over quickly like Internet discount retailers.
Herzlos wrote: Yeah I think the issue was that they would make a bigger return on other things, and just assumed that they cannibalized sales from the big lines and that dropping them would move people over to WHF/40K.
In reality, dropping them moved people over to Dreadball, Dungeonball, Guildball, Dropzone Commander, Infinity, Malifaux, and so on.
I think they've also stopped caring about anything that doesn't result in a immediate direct profit (good will, customer retention). Presumably because Kirby is about to retire and doesn't care about the long term as much as he does about his dividends.
Devil's Advocate - According to the internets, Kirby has been set to retire since 2006 and has only been worried about short term gains since then. Heck, if you could go back to www.portent.net, I'm sure you could find people using the same narrative against Kirby all the way back to the late 90's.
I don't remember it being as bad in the 90's, but then I was 15. I assume Kirby has had the 8% stock since then though, so self-interest will have been a thing.
How is GW being short minded? They took a huge hit by pushing out Internet retailers to support brick and mortar stores. They are pushing to support their business partners better. This is a long term strategy and has more direct impact on the Company's financial statements than cutting specialist games. If GW was being short minded and wanted to boost their short term sales, they would sell their product to anyone who could turn it over quickly like Internet discount retailers.
I don't believe for a second that the internet retailers things was to help brick and mortar stores except their own. I think it was just to cut off the possibility of discounts. Same with the new trade rules on splitting boxes. Their approach was keeping the price up (and growing) and trying to drive as much traffic as possible through themselves.
Where's the long term strategy in forbidding US stores to sell online via a store instead of email, without even being allowed to use images or list stock?
Where's the long term strategy in reducing stock availability to 3rd parties?
What about dropping the specialist games, vets nights, and gaming tables from stores, or going to 1-man, and high street retailers stocking the starter boxes*?
What about getting rid of the regional HQ's, or the web content, or the Games Days or Tournament support?
What about all the shovelware mobile games, or the digital supplements, or White Dwarf?
All of that fits in with a maximum profit right now approach.
*When I got into gaming, every other town centre had somewhere that sold Hero Quest and 40K boxes. In the UK it was Argos and toy stores, in the US I think it was Walmart. Essentially, if it sold Scrabble, it sold GW/MB stuff. Now it's not even available in Board-game-geek stores.
Herzlos wrote: Yeah I think the issue was that they would make a bigger return on other things, and just assumed that they cannibalized sales from the big lines and that dropping them would move people over to WHF/40K.
In reality, dropping them moved people over to Dreadball, Dungeonball, Guildball, Dropzone Commander, Infinity, Malifaux, and so on.
I think they've also stopped caring about anything that doesn't result in a immediate direct profit (good will, customer retention). Presumably because Kirby is about to retire and doesn't care about the long term as much as he does about his dividends.
Devil's Advocate - According to the internets, Kirby has been set to retire since 2006 and has only been worried about short term gains since then. Heck, if you could go back to www.portent.net, I'm sure you could find people using the same narrative against Kirby all the way back to the late 90's. How is GW being short minded? They took a huge hit by pushing out Internet retailers to support brick and mortar stores. They are pushing to support their business partners better. This is a long term strategy and has more direct impact on the Company's financial statements than cutting specialist games. If GW was being short minded and wanted to boost their short term sales, they would sell their product to anyone who could turn it over quickly like Internet discount retailers.
Go and ask all those owners of B+M stores how that's worked out for them.
Seriously, that's a terrible argument to try and make, major stores (Miniature Market for instance) have cut GW entirely, my nearest Indy has never sold GW and to have retailers (Mikhalia being the most prominent) frequently bemoaning policies as either pants on head stupid to borderline illegal on this very message board, heavily suggests you haven't really got a grasp of the facts.
Their own stores are spectacularly underperforming and they have already heavily implied that their third party sales are down this year, there is zero evidence that they're supporting B+M stores, even their own, and there's a wealth of evidence that suggests rather than support their business partners, they're trying their best to squeeze them out of the chain altogether.
boyd wrote: This is a long term strategy and has more direct impact on the Company's financial statements than cutting specialist games.
Cutting specialist games was a completely foolish decision, especially if you look around today's market. Take BFG for example. It was a popular and profitable game to sell and even FW directly acknowledged their BFG models sold well and continuously. Even now, if FW were to do Battlefleet: Heresy, it'd be a winner.
But cutting it entirely? So many companies and games have stepped up into the void left by GW - X-Wing, Firestorm Armada, the upcoming Halo Battles and Dropfleet Commander, Star Wars Armada, on and on. Same goes for the rest of the lines cut as well. They've just handed their competitors the golden gift of an eager market after a certain product. In this case, a bunch of gamers wanting to play spaceship games.
It's not really a household name over here. I mean I've run into people who have heard of them (or heard of 'Warhammer' at least) but I've equally run into people who don't have a clue. Especially these days where even the shops here are pretty out of the way of main high streets. They used to sell it in Waterstones (back when it was Ottakars) and Hobbycraft, but not anymore. I can imagine it's more commonly known here than elsewhere but 'household name' is definitely reaching.
I really don't think so. 'Almost a household name' is really stretching it.
Everyone that I have mentioned wargaming to over recent years has at least been vaguely aware of Games Workshop, and that includes various female colleagues in their 50s. In fact the only person who didn't have a clue was from Zimbabwe. In the UK at least GW is a household name (or very close to it). GW has even found its way onto mainstream television (usually as a joke but at least people are expected to know whats funny).
Thats not really the point though; in the 'young(ish) and geeky' demographic 40k has a lot of weight.
I really don't think so. 'Almost a household name' is really stretching it.
Everyone that I have mentioned wargaming to over recent years has at least been vaguely aware of Games Workshop, and that includes various female colleagues in their 50s. In fact the only person who didn't have a clue was from Zimbabwe. In the UK at least GW is a household name (or very close to it). GW has even found its way onto mainstream television (usually as a joke but at least people are expected to know whats funny).
Thats not really the point though; in the 'young(ish) and geeky' demographic 40k has a lot of weight.
Even if it is a household name in the UK... I still think the IP is a bit overrated by the fans. Star Wars, Star Trek, Halo, Game of Thrones, Battlestar Galactica, Warcraft, Marvel Comics, etc, I think a new company would be more interested in those IP's than 40k. You can pick almost any AAA video game and it would have sold vastly more copies than GW has active customers. And even if they were interested in 40k, I don't think it'd be to support the lumbering behemoth/convoluted mess of what GW created but rather to create smaller offshoot games.
Oddly enough in the 3 odd "local" stores in my area I actually feel the squeeze of Magic the Gathering.
~80% of income for one of the stores and on the three magic nights the place is crammed.
Talking to the owner for this store he says any young person asking about 40k "most of the time" had a father who played it.
The rest of the time they are an immigrant from the UK.
The 2-3% dregs is from someone who played Magic or Pokémon who happened to see the 40k guys playing on the Thursday.
Again, this is no great study, just stores in the area of a couple universities and a college and some observations: regional results may vary.
AllSeeingSkink wrote: Even if it is a household name in the UK... I still think the IP is a bit overrated by the fans. Star Wars, Star Trek, Halo, Game of Thrones, Battlestar Galactica, Warcraft, Marvel Comics, etc, I think a new company would be more interested in those IP's than 40k. You can pick almost any AAA video game and it would have sold vastly more copies than GW has active customers. And even if they were interested in 40k, I don't think it'd be to support the lumbering behemoth/convoluted mess of what GW created but rather to create smaller offshoot games.
I'm not really sure what your point is. Yes GW's games are nowhere near as popular as something like Star Wars but that most certainly doesn't mean that they aren't valuable as an IP; as can be seen by the sheer volume of GW licensed games that are coming out, not least Warhammer Total War, or that GW isn't a viable business (at least if run by someone at least semi competent).
Almost exclusively as something they "used to play when they were younger", though.
Nostalgia is a very powerful force.
I agree, that's what makes the Space Hulk limited edition so stupid. Lots of nostalgic gamers going into GW stores after 20 years to give Space Hulk a go only to be told it's sold out and not coming back.
Nostalgia has an impact, sure, but obviously not enough as most of the ex-gamers are still ex-gamers. I suspect the massive price hikes since their last purchase and the lack of specialist games will kill off most nostalgia inspired interest.
Household name? Every male in the West under 30? You're kidding me. Here in the U.S., I've barely met anyone who knows about tabletop wargaming at all, let alone GW. There's probably a significant segment of nerds who haven't heard of it. D&D and Pokemon are household names. Magic is too, to a lesser degree. Unless you've been in an FLGS or have a sibling or parent who's involved, you've more than likely never heard of Warhammer.
This is from the Motley Fool UK site. From an article dated May 22. Discuss.
Games Workshop Group
Goblin emporium Games Workshop (LSE: GAW) is one of the leading chargers in Friday trade and was recently up 3.6% on the day. And with good reason, in my opinion, as the gamesmaker’s painful cost-cutting measures paves the way for solid earnings growth. The company’s products have a fierce following amongst fantasy lovers the world over, and with Games Workshop stepping up new product roll-outs I reckon the stage is set for revenues to gallop higher.
This view is shared by the City, and analysts expect the business to follow an 8% earnings rise in the year concluding May 2015 with extra advances in the region of 6% and 5% in 2016 and 2017 respectively. Consequently Games Workshop changes hands on a P/E rating of 12.4 times for the forthcoming year — comfortably below the value threshold of 15 times — and which drops to 11.8 times in 2017.
But it is in the dividend stakes where the niche gamebuilder really sets itself apart, and Games Workshop’s terrific cash generation is expected to drive an estimated payment of 32p per share for fiscal 2015 to 35p in 2016, and again to 40p the following year. As a result the company boasts enormous yields of 6.9% and 7.8% for 2016 and 2017 respectively.
I agree, that's what makes the Space Hulk limited edition so stupid. Lots of nostalgic gamers going into GW stores after 20 years to give Space Hulk a go only to be told it's sold out and not coming back.
Nostalgia has an impact, sure, but obviously not enough as most of the ex-gamers are still ex-gamers.
Would they be gamers if they could have bought that copy of Space Hulk? The barrier of entry for GWs games is far, far too high, very few people want to spend hundreds of pounds to paint dozens and dozens of models to play a game they enjoyed a decade ago.
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Guildsman wrote: Household name? Every male in the West under 30?
Yes, and an exaggeration on my part but still GW's brands are highly recognisable.
doktor_g wrote: This is from the Motley Fool UK site. From an article dated May 22. Discuss.
Games Workshop Group
Goblin emporium Games Workshop (LSE: GAW) is one of the leading chargers in Friday trade and was recently up 3.6% on the day. And with good reason, in my opinion, as the gamesmaker’s painful cost-cutting measures paves the way for solid earnings growth. The company’s products have a fierce following amongst fantasy lovers the world over, and with Games Workshop stepping up new product roll-outs I reckon the stage is set for revenues to gallop higher.
This view is shared by the City, and analysts expect the business to follow an 8% earnings rise in the year concluding May 2015 with extra advances in the region of 6% and 5% in 2016 and 2017 respectively. Consequently Games Workshop changes hands on a P/E rating of 12.4 times for the forthcoming year — comfortably below the value threshold of 15 times — and which drops to 11.8 times in 2017.
But it is in the dividend stakes where the niche gamebuilder really sets itself apart, and Games Workshop’s terrific cash generation is expected to drive an estimated payment of 32p per share for fiscal 2015 to 35p in 2016, and again to 40p the following year. As a result the company boasts enormous yields of 6.9% and 7.8% for 2016 and 2017 respectively.
Got a link?
Tried looking for "Games Workshop" on the site search and they've got nothing listed since last year.
doktor_g wrote: This is from the Motley Fool UK site. From an article dated May 22. Discuss.
Games Workshop Group
Goblin emporium Games Workshop (LSE: GAW) is one of the leading chargers in Friday trade and was recently up 3.6% on the day. And with good reason, in my opinion, as the gamesmaker’s painful cost-cutting measures paves the way for solid earnings growth. The company’s products have a fierce following amongst fantasy lovers the world over, and with Games Workshop stepping up new product roll-outs I reckon the stage is set for revenues to gallop higher.
This view is shared by the City, and analysts expect the business to follow an 8% earnings rise in the year concluding May 2015 with extra advances in the region of 6% and 5% in 2016 and 2017 respectively. Consequently Games Workshop changes hands on a P/E rating of 12.4 times for the forthcoming year — comfortably below the value threshold of 15 times — and which drops to 11.8 times in 2017.
But it is in the dividend stakes where the niche gamebuilder really sets itself apart, and Games Workshop’s terrific cash generation is expected to drive an estimated payment of 32p per share for fiscal 2015 to 35p in 2016, and again to 40p the following year. As a result the company boasts enormous yields of 6.9% and 7.8% for 2016 and 2017 respectively.
Got a link?
Tried looking for "Games Workshop" on the site search and they've got nothing listed since last year.
Investors are happy as long as GW keep paying out. The last dividend they declined resulted in a drastic drop in stock value. No one seems interested in the long term, only from one report to the next and will drop them like a hot potato once they aren't in a position to keep paying out.
doktor_g wrote: This is from the Motley Fool UK site. From an article dated May 22. Discuss.
Games Workshop Group
Goblin emporium Games Workshop (LSE: GAW) is one of the leading chargers in Friday trade and was recently up 3.6% on the day. And with good reason, in my opinion, as the gamesmaker’s painful cost-cutting measures paves the way for solid earnings growth. The company’s products have a fierce following amongst fantasy lovers the world over, and with Games Workshop stepping up new product roll-outs I reckon the stage is set for revenues to gallop higher.
This view is shared by the City, and analysts expect the business to follow an 8% earnings rise in the year concluding May 2015 with extra advances in the region of 6% and 5% in 2016 and 2017 respectively. Consequently Games Workshop changes hands on a P/E rating of 12.4 times for the forthcoming year — comfortably below the value threshold of 15 times — and which drops to 11.8 times in 2017.
But it is in the dividend stakes where the niche gamebuilder really sets itself apart, and Games Workshop’s terrific cash generation is expected to drive an estimated payment of 32p per share for fiscal 2015 to 35p in 2016, and again to 40p the following year. As a result the company boasts enormous yields of 6.9% and 7.8% for 2016 and 2017 respectively.
Got a link?
Tried looking for "Games Workshop" on the site search and they've got nothing listed since last year.
"I still think the IP is a bit overrated by the fans"
Fans have this idea that GW should fail so that someone else can pick up the IP (or the company as a whole) because it's such an awesome IP that surely someone would snap it up and turn it around.
I tend to disagree and think fans overestimate the value of the 40k to other companies. Even if they are the biggest fish in the wargaming world, they aren't a big fish in the wider picture of available IP's. Even The Witcher 3 sold many times more copies than GW has active customers, by at least an order of magnitude.
as can be seen by the sheer volume of GW licensed games that are coming out
Lets just be clear, the vast majority of "sheer volume" are just cheap throw away games that don't have the budget/quality/scope of the older THQ games like DoW or Space Marine.
Motley Fool is focused entirely upon a return for investors SPECIFICALLY for a time frame set out of around two to five years.
And GW is CERTAINLY focused upon paying investors.
Also, Motley Fool has been wrong before about companies (several of their investors suggested Enron prior to its crash).
They are correct that GW will fork out dividends and see a growth in the value of their stock for at least two years.
But that is not predicated on the company lasting beyond those two years (the company could last, or it could wind up growing into oblivion, paying out dividends until it burns).
There is a difference between a company being a good investment and the company providing a decent product.
"I still think the IP is a bit overrated by the fans"
Fans have this idea that GW should fail so that someone else can pick up the IP (or the company as a whole) because it's such an awesome IP that surely someone would snap it up and turn it around.
I tend to disagree and think fans overestimate the value of the 40k to other companies. Even if they are the biggest fish in the wargaming world, they aren't a big fish in the wider picture of available IP's. Even The Witcher 3 sold many times more copies than GW has active customers, by at least an order of magnitude.
It is an awesome IP, it's only rivalled in depth by the big hitters like Trek and Wars, LotR and the MCU movies. Warhammer in both its guises (although biased heavily towards 40K) is way deeper than whatever tween trilogy that the kids are foaming over the latest movie adaptation of.
I think you're right in that perhaps some overvalue its worth in the sense of what it would cost to buy right now, but there's a line to be drawn between what Warhammer is and what it could be. The marketing potential has massive scope, just Space Marines alone (which, to be fair, is the spine of any 40K value) could carry all sorts of diversification.
The question is always would we like what a new owner of Warhammer decided to do with it, of course, and that's something we can only speculate about unless it happened.
Fans have this idea that GW should fail so that someone else can pick up the IP (or the company as a whole) because it's such an awesome IP that surely someone would snap it up and turn it around.
If the price was right GW would be snapped up very quickly. Would someone pay £500 million for GW? Not a chance. £100 million? Maybe. £10 million? It would be an absolute bloodbath. Its inconceivable that GW's IP would be allowed to die, its just too valuable.
AllSeeingSkink wrote: Lets just be clear, the vast majority of "sheer volume" are just cheap throw away games that don't have the budget/quality/scope of the older THQ games like DoW or Space Marine.
Most have been shovelware but not all. Thats not really the point though; people are still willing to buy licenses from GW, including Creative Assembly.
Games Workshop is not a household name. If you parcel the Western World down into a "gamer" subset, you might get to more than 50% knowing who they feth they are. If you parcel the "gamer" subset to "tabletop miniatures", then you're probably pushing 80%. In the "gamer" subset, I know people that have played D&D since 2nd edition who didn't have a fething clue who Games Workshop was.
In the US, probably. In the UK not really. In the UK its common, in my experience at least, for women in their 50's to be at least aware of Games Workshop, I think that qualifies as a household name. After all there is, or at least was, a GW on most high streets.
Silent Puffin? wrote: Its inconceivable that GW's IP would be allowed to die, its just too valuable.
I definitely don't mean to say it definitely won't be picked up, but I also definitely don't think it's as inevitable as many other fans seem to think. Especially as GW have milked the core game of 40k so much now. A few years ago I might have agreed.
At this stage IMO the core game of 40k is a burden more than it is benefit for new companies and likewise I think a large slab of 40k's market share is due to their stores which would also be a huge burden on someone looking to take over GW.
If there's value in 40k (and I'm not saying there's *none*) I think it'd be more in offshoot games like FFG is producing than in maintaining and supporting the core game.
Most have been shovelware but not all. Thats not really the point though; people are still willing to buy licenses from GW, including Creative Assembly.
That's a largely irrelevant statement unless we know the agreement between GW and Creative Assembly and/or the actual development resources Creative Assembly is putting in to the game.
Games Workshop is not a household name. If you parcel the Western World down into a "gamer" subset, you might get to more than 50% knowing who they feth they are. If you parcel the "gamer" subset to "tabletop miniatures", then you're probably pushing 80%. In the "gamer" subset, I know people that have played D&D since 2nd edition who didn't have a fething clue who Games Workshop was.
Saying GW is a household name is just silly.
In the UK, Games Workshop was the largest high street games shop chain for RPGs and stuff, and also the biggest publisher of rules and games, between the late 70s and the mid-90s after which it gradually became the Warhammer-only shop we all know and love now. There was also the White Dwarf magazine, which followed a similar path of glory or degradation depending on your viewpoint.
So there is a substantial awareness of GW but not actually in the form it has now assumed.
I don't think this helps them at all, though. Any nostalgic ex-GW games fan stepping into a shop now to introduce his son to the delights of Judge Dredd, Talisman, Runequest, Space Hulk, BFG or boxes of Space Marines costing less than £1 a figure is confronted with a desert landscape of almost zero games surrounded by a tall barrier of price stickers.
It isn't Coke, The BBC, Ford or anything on that scale. It's near total saturation amongst enthusiasts, it's well known enough thanks to its High St presence in the UK to have a respectable recognition amongst people who walk around with eyes, but it isn't a household name.
However, I do believe it's got the legs to become a household name, should the decision be made to do so and intelligent choices made.
I really don't think so. 'Almost a household name' is really stretching it.
Everyone that I have mentioned wargaming to over recent years has at least been vaguely aware of Games Workshop, and that includes various female colleagues in their 50s. In fact the only person who didn't have a clue was from Zimbabwe. In the UK at least GW is a household name (or very close to it). GW has even found its way onto mainstream television (usually as a joke but at least people are expected to know whats funny).
Thats not really the point though; in the 'young(ish) and geeky' demographic 40k has a lot of weight.
Anecdotal evidence. Means less than you think.
There's five people in my work who are aware, or played the game-only two of us are current players. Another dozen know what we do, and that's from us talking about it. The other eighty? We might as well be talking Dutch.
I'd say one person in ten is aware of games workshop and less than half of them would know what it's all about. Talk about the football, and you find where most people's interests lie.
In the UK, Games Workshop was the largest high street games shop chain for RPGs and stuff, and also the biggest publisher of rules and games, between the late 70s and the mid-90s after which it gradually became the Warhammer-only shop we all know and love now. There was also the White Dwarf magazine, which followed a similar path of glory or degradation depending on your viewpoint.
And the gaming market in the eighties and nineties was quite small. Being the biggest high street games shop for RPGs and stuff means very little when the player base is in the five-figure range...
In my experience it is though. All kinds of people who are entirely unaware of wargamings existence know at least roughly what GW is. GW has a lot of brand recognition in the UK, its probably not far behind D&D.
Being the biggest high street games shop for RPGs and stuff means very little when the player base is in the five-figure range...
Every town of any size in the UK has, or at least had, a GW in a prominent location. They don't need to have any interest in it to know what it is.
Everyone knows the games and wargames markets have been expanding significantly in the past ten years.
The old style GW was ideally placed to capitalise on this; locations, tradition, range of stock, and familiarity to the people in the know who recruit new players by word of mouth. Not the new one.
Even the name is a great match, and they are dumping that too!
In my experience it is though. All kinds of people who are entirely unaware of wargamings existence know at least roughly what GW is. GW has a lot of brand recognition in the UK, its probably not far behind D&D.
Sadly, your experience won't really count for much in this instance. It would take a proper, scientifically valid, survey to prove it, but frankly I don't need one to understand that my gut reaction is likely the correct one.
It's unquestionably the most recognisable brand in Tabletop Gaming, far more non-gamers will know GW in comparison to the likes of PP, Corvus Belli, FFG etc, but it is nowhere near as recognisable as Cadburys, Sony, Ferrari, Apple etc.
Guildsman wrote: Household name? Every male in the West under 30? You're kidding me. Here in the U.S., I've barely met anyone who knows about tabletop wargaming at all, let alone GW. There's probably a significant segment of nerds who haven't heard of it. D&D and Pokemon are household names. Magic is too, to a lesser degree. Unless you've been in an FLGS or have a sibling or parent who's involved, you've more than likely never heard of Warhammer.
People who think that GW is a "household name" really don't have an understanding of what that term means.
That term refers to "a person or thing who is well known to the public."
As such, if someone's "heard of it," that doesn't qualify. Those people have to "know it well."
International household names are things like Coca Cola, Apple, IBM, Jaguar, BMW, or Harvard University. You can have regional household names like the local university hospital, the local community college, or local government figure. I honestly doubt that Games Workshop is a true household name outside of Nottingham. Other than there, I'm sure there are a lot of people in England who have heard of Games Workshop, but they don't really know much of anything about the company or their products.
Outside of England, Games Workshop is a niche product that appeals to a minority of the overall number of gamers. There are more players of computer games, for starters. There are more CCG players than GW players. Heck, I'd argue that there are more pen and paper RPG players than GW players. And gamers as a whole are a minority of all people. Honestly, to assert that Games Workshop is a household name "in the West" is pure fantasy.
Automatically Appended Next Post:
Howard A Treesong wrote: Investors are happy as long as GW keep paying out. The last dividend they declined resulted in a drastic drop in stock value. No one seems interested in the long term, only from one report to the next and will drop them like a hot potato once they aren't in a position to keep paying out.
This.
As long as GW keeps paying a dividend, there are entities that will value the stock simply for that. (Though, I'm not sure why they think the value is "charging" anywhere...it's under $10.00 USD per share and has been for several years now. Right now, it's trading at 500p, or $7.73.)
doktor_g wrote: This is from the Motley Fool UK site. From an article dated May 22. Discuss.
Games Workshop Group
Goblin emporium Games Workshop (LSE: GAW) is one of the leading chargers in Friday trade and was recently up 3.6% on the day. And with good reason, in my opinion, as the gamesmaker’s painful cost-cutting measures paves the way for solid earnings growth. The company’s products have a fierce following amongst fantasy lovers the world over, and with Games Workshop stepping up new product roll-outs I reckon the stage is set for revenues to gallop higher.
This view is shared by the City, and analysts expect the business to follow an 8% earnings rise in the year concluding May 2015 with extra advances in the region of 6% and 5% in 2016 and 2017 respectively. Consequently Games Workshop changes hands on a P/E rating of 12.4 times for the forthcoming year — comfortably below the value threshold of 15 times — and which drops to 11.8 times in 2017.
But it is in the dividend stakes where the niche gamebuilder really sets itself apart, and Games Workshop’s terrific cash generation is expected to drive an estimated payment of 32p per share for fiscal 2015 to 35p in 2016, and again to 40p the following year. As a result the company boasts enormous yields of 6.9% and 7.8% for 2016 and 2017 respectively.
Got a link?
Tried looking for "Games Workshop" on the site search and they've got nothing listed since last year.
I agree, that's what makes the Space Hulk limited edition so stupid. Lots of nostalgic gamers going into GW stores after 20 years to give Space Hulk a go only to be told it's sold out and not coming back.
Nostalgia has an impact, sure, but obviously not enough as most of the ex-gamers are still ex-gamers.
Would they be gamers if they could have bought that copy of Space Hulk? The barrier of entry for GWs games is far, far too high, very few people want to spend hundreds of pounds to paint dozens and dozens of models to play a game they enjoyed a decade ago.
They might do, but without the gateway we'd never know. They'd likely come back and buy each specialist game re-release even if they didn't get into the wider hobby.
I mean, I'd totally buy a re-released Blood Bowl or Hero Quest if they brought them out. I've got a 2014 Space Hulk in the cupboard, bought for nostalgia sake, because I happened to know it was coming and managed to pre-order it.
I agree, that's what makes the Space Hulk limited edition so stupid. Lots of nostalgic gamers going into GW stores after 20 years to give Space Hulk a go only to be told it's sold out and not coming back.
Nostalgia has an impact, sure, but obviously not enough as most of the ex-gamers are still ex-gamers.
Would they be gamers if they could have bought that copy of Space Hulk? The barrier of entry for GWs games is far, far too high, very few people want to spend hundreds of pounds to paint dozens and dozens of models to play a game they enjoyed a decade ago.
They might do, but without the gateway we'd never know. They'd likely come back and buy each specialist game re-release even if they didn't get into the wider hobby.
I mean, I'd totally buy a re-released Blood Bowl or Hero Quest if they brought them out. I've got a 2014 Space Hulk in the cupboard, bought for nostalgia sake, because I happened to know it was coming and managed to pre-order it.
You do know that there is another Heroquest coming right? From a company called Gamezone.
I think you're right in that perhaps some overvalue its worth in the sense of what it would cost to buy right now, but there's a line to be drawn between what Warhammer is and what it could be. The marketing potential has massive scope, just Space Marines alone (which, to be fair, is the spine of any 40K value) could carry all sorts of diversification.
The question is always would we like what a new owner of Warhammer decided to do with it, of course, and that's something we can only speculate about unless it happened.
I'm not sure there's anything so unique to Warhammer that you'd need to buy the license rather than just create your own distopian future with bio-engineered supersoldiers fighting various space monsters.
There's some buy in from the name, but you'd probably be better starting from scratch using some of the bigger sci-fi worlds as you're starting point.
Which has already been snatched up. If the Halo space combat game goes well, we may see more licensed games in the future.
I'm definitely not convinced that 40K really has that much value as an IP outside of the tabletop community. A couple novel series and a few moderately successful video games doesn't make for a hugely desirable IP. If it does get picked up, it'll be like D&D, where a long-time fan in a position of power was able to step in and save the game.
I think you're right in that perhaps some overvalue its worth in the sense of what it would cost to buy right now, but there's a line to be drawn between what Warhammer is and what it could be. The marketing potential has massive scope, just Space Marines alone (which, to be fair, is the spine of any 40K value) could carry all sorts of diversification.
The question is always would we like what a new owner of Warhammer decided to do with it, of course, and that's something we can only speculate about unless it happened.
I'm not sure there's anything so unique to Warhammer that you'd need to buy the license rather than just create your own distopian future with bio-engineered supersoldiers fighting various space monsters.
There's some buy in from the name, but you'd probably be better starting from scratch using some of the bigger sci-fi worlds as you're starting point.
That's much more of a roll of the dice though, no pun intended.
Many of Jes Goodwin's designs, Marines included, are exceptional, plus the background has at least something approaching a fan base and some semblance of public recognition.
That's an awful lot more traction to get going than a standing start and an unproven concept.
That's an awful lot more traction to get going than a standing start and an unproven concept.
You'd get an awful lot of bad to go with the good if you brought the IP though. For every 3rd war for Armageddon there is a Murderfang murdering with his murderclaws on planet (h)Omicide.
I know just from looking at the RPG books that trimming the stupid fanfiction esque fluff from the good stuff is a daunting task, and not everyone will agree on what should stay and what should go so the decision often ends up change nothing so no one can complain that they want to play a centuion, but then everyone loses interest and plays D&D instead.
The bad is irrelevant if you're talking about expansion, the people who know about it will ultimately reflect a tiny portion of the market you're shooting for, and those who have a problem with it (those outside the 14 yo pew pew crowd) will be a smaller subdivision of that.
No, at this point i still believe the IP has real potential, I even believe that correctly handled the game could be turned around massively in very short order.
That's an awful lot more traction to get going than a standing start and an unproven concept.
You'd get an awful lot of bad to go with the good if you brought the IP though. For every 3rd war for Armageddon there is a Murderfang murdering with his murderclaws on planet (h)Omicide.
I know just from looking at the RPG books that trimming the stupid fanfiction esque fluff from the good stuff is a daunting task, and not everyone will agree on what should stay and what should go so the decision often ends up change nothing so no one can complain that they want to play a centuion, but then everyone loses interest and plays D&D instead.
That has to be the funniest thing I have seen this month (maybe this year - I will have to go back and check)
. . .there is a Murderfang murdering with his murderclaws on planet (h)Omicide.
THAT was priceless...
And sad at the same time, because it is pretty much true.
MB
Automatically Appended Next Post: And I agree with Azreal.
The 40K IP could produce some of the best gaming material ever produced.
I should probably think about how to capitalize on that...
lord marcus wrote:how is the core game a burden? if they take over the IP, they will most likely buy the molds, meaning maintaining the core game is irrelevant.
The game is *huge* now as far as the range is concerned and it's profitability in GW's hands is largely driven by new releases every month and the size of the community base is in large part driven by the stores which no longer have good turnover.
Fixing the actual "game" part of it would actually be quite difficult given what 40k has become. Shrinking the game or reducing the scope would be what a lot of old gamers would like, but then a lot of current gamers wouldn't want that.
It's not a game you can just sit on and expect it to make you money and I think a lot of the ideas for fixing things that would have worked several years ago wouldn't work now, and even less likely in a few years time when GW has milked the IP to the point where they want to (or have to) sell it.
BeAfraid wrote:. . .there is a Murderfang murdering with his murderclaws on planet (h)Omicide.
THAT was priceless...
And sad at the same time, because it is pretty much true.
It's not "pretty much" true, it's ENTIRELY true. In fact you left out the part about Murderfangs Murderlust which he achieves through his Murderclaws on the planet of Omnicide. Not to mention they gave it a head that looks remarkably similar to the character Murderface...
AllSeeingSkink wrote: . Not to mention they gave it a head that looks remarkably similar to the character Murderface...
That would be a coincidence. GW's designers don't have any outside influences... Everything they make comes completely out of their own heads. They said so in court, so it's true.
I agree, that's what makes the Space Hulk limited edition so stupid. Lots of nostalgic gamers going into GW stores after 20 years to give Space Hulk a go only to be told it's sold out and not coming back.
Nostalgia has an impact, sure, but obviously not enough as most of the ex-gamers are still ex-gamers.
Would they be gamers if they could have bought that copy of Space Hulk? The barrier of entry for GWs games is far, far too high, very few people want to spend hundreds of pounds to paint dozens and dozens of models to play a game they enjoyed a decade ago.
They might do, but without the gateway we'd never know. They'd likely come back and buy each specialist game re-release even if they didn't get into the wider hobby.
I mean, I'd totally buy a re-released Blood Bowl or Hero Quest if they brought them out. I've got a 2014 Space Hulk in the cupboard, bought for nostalgia sake, because I happened to know it was coming and managed to pre-order it.
You do know that there is another Heroquest coming right? From a company called Gamezone.
And it looks bloody fantastic..
I still find it hilarious that Gamezone snapped the rights up.
Cannot wait to add that to my growing Boardgame collection.
You do know that there is another Heroquest coming right? From a company called Gamezone.
And it looks bloody fantastic..
Yup, and I'll be snapping that box up as soon as it hits retail.
Azreal13 wrote: The bad is irrelevant if you're talking about expansion, the people who know about it will ultimately reflect a tiny portion of the market you're shooting for, and those who have a problem with it (those outside the 14 yo pew pew crowd) will be a smaller subdivision of that.
If the people that already know about the IP are a tiny portion of your market, then that's not a great reason to buy it. GW's IP has some recognition (mostly positive but with plenty of negative) but that seems to mostly be with people who have been put off from GW. Is that recognition worth, say, £10m? Would it be better to use the same £10m to expand on something like Heinleins Starship troopers IP? Or one of HG Wells settings? Or something from 2000AD?
For £10m, you could easily construct a totally legal not-40K almost in its entirety, without having to take on any of it's baggage or retconning. You'd have to change the names and words but the concepts already exist out there.
40K and its fluff have a strong resonance with a lot of gamers. That is what has let GW get away with their pricing and in some areas low quality for so long. If people want to play 40K with 40K models rather than another background and models that are cheaper and better, then they apparently are prepared to pay high prices for the official books and kits.
Or the fact that for a long time, it was the only game in town?
It's not hard to inflate the value of 40k, and imagine it as 'all that, and a bag of chips' when it's all you know/are familiar with, and when you've consequently overinvested in that one ip as a result..
Well, 40K is a Jonny come lately for historicals players.
It seemed to grab the imagination of a new audience for which it was perhaps their first exposure to tabletop wargames. It was in my opinion sustained for a long time by those people and the other newcomers they brought in.
However this thread is about GW, not 40K. I don't think WHFB or 40K could have grown so large without the GW retail chain's support. But GW's retail chain perhaps cannot live off only WHFB and 40K.
Kilkrazy wrote: But GW's retail chain perhaps cannot live off only WHFB and 40K.
To be honest, I don't think the retail chain is able to survive management's decision to marginalize it. The current structure is a model that will likely transition GW out of direct retail, if management isn't completely stupid that is.
Edit:
Direct, physical retail I mean as web sales are a form of direct retail.
So much so, in fact, that it makes me wonder if anyone in their corporate division has even seen a business school.
Their retail section is losing money. As in, it actually has a deficit. Not a huge one, but still. Their entire profits are more or less equally distributed between trade accounts (i.e., sales to independent retailers) and online sales.
That their 'hobby centres' are losing money is not the end of the world. Look at Apple Stores, for example. Super expensive locations and a horde of staff. I can't be bothered to look at Apple's financial reports, but I'd gladly bet their stores are losing money. But, that loss isn't really a loss. It's advertising expenses. You spend an hour talking to some dude in a blue t-shirt, then order your iPhone from some online retailer having a sale? Great. You're meeting up with your friends downtown? Where do you meet? Oh, on Nanjing East Rd, in front of the Apple Store. Good times.
What does GW do? All of the wrong things.
They want repeat customers to buy from GW's own online store instead of wherever it is they're buying. Of course. Higher margins. Any company would want that. No problem so far.
They remove availability of kits from physical stores to direct only (more than 1000 of them). Nothing wrong with this. You can't have low selling products taking up valuable shelf space. Of course, the idea of restructuring your production strategy when you, as a small/mid-size company, have 1000+ products that aren't selling enough to justify their space on the shelves seems like it's to complicated to understand for them.
Their loss-operating stores? Write it off as advertising expenses? Hell no! That gak is otiose in a niche. Better run away from the high street, move to one-man-stores, and count on that to provide growth. Wait... Growth? Yep, their stated business strategy is that divestment in location and reduction in staff (and opening hours) will lead to growth. It seems like they've forgotten about the problems of central overheads and shrinking revenue, with regards to that growth of theirs. Nevermind the decreasing revenue channels through new customers being led to the high margin outlets (online store) through outreach (bnc stores).
Hey ho! But there's still the trade accounts, right? One third of revenue, half of the profits. Let's make sure to make them all hate you! [insert the 'Haha! Business!' meme here] Micromanaging trade accounts, severing ties with outreach-potential-rich partners (stores that take in a small percentage of their revenue from GW products, and the rest from products with a similar target market). Choo-choo! Let's piss off an entire sales region while we're at it! Losing 20% revenue there two years in a row? Otiose! Pokemon! Pogs!
And then there's the products themselves.
You know these apologicisms GW white knights throw around on the internet? "Of course they nerfed the old models and gave the new stuff super-OP rules! GW's a business, man! They need to make money!" Or; "Screw balance, you WAAC loser, 40k isn't about competitive play, it's about forging the narrative!" And, you know how they recalled a bunch of Dreadfleet (and whatever other failures they've brought out) for destruction instead of having a massive sale? Or how they never have any sales ever? Yeah. To avoid devaluing their products. GW do both these things simultaneously. Can you see the paradox? They're willfully forgoing revenue to avoid product devaluation ('cause it's a Space Marine Ferrarri, bro), which is fine on its own, while devaluing their product through purposefully making it inferior.
If you could ask any super-successful business-mogul what the first rule of business is, what would they say? Not specifically about their company, but just as a general question. What's the first rule of business?
Don't make it hard for your customers to do business with you?
Have a great product, have the best product?
Forget your pride, do what works?
Embrace the web?
Treat business partners, customers, manufacturers with respect and make them want you to succeed?
Understand your market, and your target audience?
These aren't cherry-picked to fit my point, these are real (well, paraphrased) priorities from people who know what they're talking about. And they're also things GW completely and utterly fail at.
GW have great models, but let's be honest, the rules aren't exactly flawless. Why?
GW don't pay attention to market trends and what competitors are doing to be successful, nor are they allowing their trade partners to maximize their success in their own local areas. Why?
GW treat the internet as inconsequential. Why?
GW have a significant portion of their customer base and potential customer base and former customer base hating them. Why?
Market research is otiose in a niche. Jibber-jabber! Wham-wham! Business! "Our customers' hobby is purchasing our product." Brilliance, straight from the Little Dumb Book of Merrett, under oath.
@Thud.
Customers,and potential customers do not 'hate ' GW.
Some are frustrated with the stupid way Kirby and co do business.
Some are angry that incompetent corporate managers are destroying the game and hobby they are/were heavily invested in.
With short sighted short term money grabs that are destroying the long term future of the GW games, the GW hobby and GW plcs long term future.
Some take offence at the way GW plc attack the fan sites and independent retailers that want to support and promote GW products.
Many are ashamed to deal with GW after the Spots the Space Marine fiasco.
However, most are just disconnected from GWs '..we sell toy soldiers to children.. ' corporate mind set.
And or dejected by the way GW treat customers as 'a necessary evil that holds the money they want to take.'
In sort they treat GW with a similar level of apathy and contempt , GW plc show to their customers...
You can't make that sort of statement without data to back it up, I'm afraid. Otherwise it's simply anecdotal and subjective, and given both the numbers and distances involved in assessing the impact anything has in the States, essentially meaningless.
I mean, I could say that everyone I know knows about GW/Warhammer, because most of them have some inkling I'm involved with it, but it doesn't follow that this scales up to a national picture.
I'm by no means saying you're wrong, but it's an unsupported statement with no hard info to back it up.
I'll second minimal general knowledge of Games workshop and 40k/Fantasy stateside. Considering people that I didn't tell about the hobby very few people in my entire life have known about it, very few could have produced or recognized the name Games Workshop. I've lived in NY and WI and noticed no difference. I would be shocked if greater than 1% in the US recognized 40k and or Games Workshop.
Given how often people mistake GW stores for video game stores, that sorta says enough about whether they're a household name.
In my own experience, I found that Warhammer is a name that was vaguely known in the UK, but Games Workshop itself definitely was not. So far, here in Australia, I've found that neither are particularly well known. Anecdotal, aye, but it does suggest that GW/Warhammer might not be as widely known--even in the UK--as some are wanting to suggest.
Thud wrote: Look at Apple Stores, for example. Super expensive locations and a horde of staff. I can't be bothered to look at Apple's financial reports, but I'd gladly bet their stores are losing money.
I would take that bet and win. Apple stores are filthy profitable (if I remember correctly they are the most profitable stores in the world) for them and the genius bar gives people confidence to buy Apple's stuff because they get free tech support included (even without the add on insurance).
But overall I agree with what you said. I read a study some time ago that compared retail store performance around the 2008 depression (± a few years) and the stores that slimed down essentially lost profitability (not matter the industry) because people didn't get the service they are used from stores and spent their money elsewhere. Stores that stayed the course or even increased their employee count became more profitable.
Of course of you are GW and need to cut expenses in the short term then you can't invest into your stores for the long term.
Akragth wrote: Given how often people mistake GW stores for video game stores, that sorta says enough about whether they're a household name.
Well if GW goes forward with their store re-branding policy, customers will never have to worry about wandering into a store that doesn't have what they're looking for!
So much so, in fact, that it makes me wonder if anyone in their corporate division has even seen a business school. ...
Possibly. They may have also seen The Producers in either its play and/or movie format.
There comes a point when Hanlon's Razor gives too much benefit of the doubt.
I was already guffawing whilst reading the rest of your post Thrud but these two lines both sent me into a maniacal cackle which I am glad a customer did not witness. Thanx for the (maniacal) laugh.
EXALTED!
You're not the only one, mind you kirby is doing his laughing all the way to the bank.
28th of july, eh? Seems a bit late compared to normal, oh well. I'm expecting revenue to be down again, continuing the diagonal line down it has been for the last couple years. The thing is, the cost cutting has done wonders for propping up the bottom line, and barring anymore 4million websites their profit will look tidy again. Not good for the long-term health of the business, but who's interested in that, really?
Then we'll get to hear "but they're still making a profit! So...everything is ok. "
If a company is continuing to go down they either fail, level out or reverse. GW shows no signs of the latter two seeing as how they keep doing the same things without understanding anything on or around them
They seem content to try to get everything to fit within the company's four walls because any money not being handed to them directly by a consumer is competition.
"Success" by their main measure is dividends.
As long as they can do that, all is well.
You look at the comments in the financial report and all boils down to "Everything is going as planned and if what is planned is not that good, it is due to <initiate inarguable excuse generator> global warming <end> so not our fault."
<edit> An evil part of me came up with the thought: If you manage to get most of your sales all directly, is it not easier to cook the books if you want to?
Not saying they do, just that the option becomes a little more viable or tempting...
Book cookery would depend on the independent external auditors being fooled into passing the accounts. I very much doubt they cook the books. They do change the way they report fairly frequently, for instance last year they stopped reporting on a regional basis and started to report in channel verticals. This was justified by the elimination of the regional HQs and centralisation at Nottingham, which is not unreasonable but it does deprive the investor of information about where things are going well or badly.
Auditing's really about checking the principles of how you collate data are legal. Of course they spot check cuts of it, but it generally lacks enough depth to find something you're deliberately trying to hide unless it's pretty big and obvious (and I did work for a company where the FD got censored by whichever accounting body he was a member of for trying it on).
If the auditors feel that the construction of the accounts that you're drawing your shareholders' report from is sound, in all likelihood the report itself will get a pass.
I've always felt that if you restate data material to understanding the company's performance, you should be legally required to present 5 years of restated data at a minimum to allow shareholders a chance to understand meaningful trends.
Has anyone ever done an analysis of what would happen if the GW suddenly started dropping its prices back to, say, year 2000 levels?
Would the increased business make up for the potential losses? Would business actually increase at all? I'm guessing it probably would.
I read somewhere that a true businessman will look for fewer, higher value sales than lots of small, cheap sales. But in the UK, the cheap supermarkets selling crap quality products, such as Aldi and Lidl (it's not all crap by any means but it certainly isn't spectacular), are hugely outperforming Morrisons and Tesco, whose quality, and therefore prices, are noticeably higher. The smaller supermarkets are paying staff up to £10 per hour for sitting on a checkout, while Morrisons is not replacing staff who leave and Tesco's expansion plans are up a Snotling's arse.
Whether you look for fewer, more expensive sales, or higher volume, but lower price depends upon the market you are looking for, as well as the product you provide.
It is this dichotomy that puts GW at odds with itself.
It claims to want to wholly dominate the gaming market, yet at the same time claiming it wishes to be solely about providing luxury high-end collectables.
The Gamer Market is SOLELY about market saturation. It about selling at as high a volume as possible.
The Collector's Market is primarily about providing as high-end goods as possible.
GW claims to simultaneously be both of these while fulfilling neither goal.
It neither provides inexpensive, yet quality, goods to saturate a market, nor does it provide the best possible quality good for a luxury collector's market.
But in answer to your question, simple optimization algorithms would definitively answer the question of what would happen if GW reduced their prices IFF they did any market research.
MOST companies do such research twice a year to determine price adjustments.
HOWEVER... All of that aside... The basic assumptions of Price Optimization Algorithms tend to support the claim that reducing their prices slightly (just returning to selling a full 10 Marines per box, or 24 Infantry in their Fantasy lines) would more than make up for the reduced returns per item.
NoPoet wrote: Has anyone ever done an analysis of what would happen if the GW suddenly started dropping its prices back to, say, year 2000 levels?
Would the increased business make up for the potential losses? Would business actually increase at all? I'm guessing it probably would.
Supposedly, GW have confirmed for themselves by releasing similar kits in different price points that the price doesn't really make a significant difference to sales.
Whether or not that confirmation is actually backed up by the data would depend on whether or not they also took into consideration all of the other reasons a particular kit might or might not sell, and the way those reasons differ between different kits...
Supposedly, GW have confirmed for themselves by releasing similar kits in different price points that the price doesn't really make a significant difference to sales.
Wasn't that something along the lines of, making cold ones a bit cheaper but leaving most of the rest of the army to cost a bomb?
So, have we started a pool about what kind of interesting statements might be in the next preamble?
The last one included the SAT word, "otiose." (I'm certain that 90%+ had to look that one up. I did, and I ranked in the 99th percentile on the verbal section of my GMAT last year.)
Any wagers on what sort of bombasticisms, hyperbole, or vocabulary test words it might include?
Saldiven wrote: So, have we started a pool about what kind of interesting statements might be in the next preamble?
The last one included the SAT word, "otiose." (I'm certain that 90%+ had to look that one up. I did, and I ranked in the 99th percentile on the verbal section of my GMAT last year.)
Any wagers on what sort of bombasticisms, hyperbole, or vocabulary test words it might include?
"Our customers, with regards to our gaming rules, might engage in floccinaucinihilipilification, but is it true? Digimon withered and died, but Dylan went electric. Ding-ding! Another great year!"
Saldiven wrote: So, have we started a pool about what kind of interesting statements might be in the next preamble?
The last one included the SAT word, "otiose." (I'm certain that 90%+ had to look that one up. I did, and I ranked in the 99th percentile on the verbal section of my GMAT last year.)
Any wagers on what sort of bombasticisms, hyperbole, or vocabulary test words it might include?
You mean a contest of adumbration about the raillery and persiflage that might be presented in the new CEO preamble?
So much so, in fact, that it makes me wonder if anyone in their corporate division has even seen a business school.
Their retail section is losing money. As in, it actually has a deficit. Not a huge one, but still. Their entire profits are more or less equally distributed between trade accounts (i.e., sales to independent retailers) and online sales.
That their 'hobby centres' are losing money is not the end of the world. Look at Apple Stores, for example. Super expensive locations and a horde of staff. I can't be bothered to look at Apple's financial reports, but I'd gladly bet their stores are losing money. But, that loss isn't really a loss. It's advertising expenses. You spend an hour talking to some dude in a blue t-shirt, then order your iPhone from some online retailer having a sale? Great. You're meeting up with your friends downtown? Where do you meet? Oh, on Nanjing East Rd, in front of the Apple Store. Good times.
What does GW do? All of the wrong things.
They want repeat customers to buy from GW's own online store instead of wherever it is they're buying. Of course. Higher margins. Any company would want that. No problem so far.
They remove availability of kits from physical stores to direct only (more than 1000 of them). Nothing wrong with this. You can't have low selling products taking up valuable shelf space. Of course, the idea of restructuring your production strategy when you, as a small/mid-size company, have 1000+ products that aren't selling enough to justify their space on the shelves seems like it's to complicated to understand for them.
Their loss-operating stores? Write it off as advertising expenses? Hell no! That gak is otiose in a niche. Better run away from the high street, move to one-man-stores, and count on that to provide growth. Wait... Growth? Yep, their stated business strategy is that divestment in location and reduction in staff (and opening hours) will lead to growth. It seems like they've forgotten about the problems of central overheads and shrinking revenue, with regards to that growth of theirs. Nevermind the decreasing revenue channels through new customers being led to the high margin outlets (online store) through outreach (bnc stores).
Hey ho! But there's still the trade accounts, right? One third of revenue, half of the profits. Let's make sure to make them all hate you! [insert the 'Haha! Business!' meme here] Micromanaging trade accounts, severing ties with outreach-potential-rich partners (stores that take in a small percentage of their revenue from GW products, and the rest from products with a similar target market). Choo-choo! Let's piss off an entire sales region while we're at it! Losing 20% revenue there two years in a row? Otiose! Pokemon! Pogs!
And then there's the products themselves.
You know these apologicisms GW white knights throw around on the internet? "Of course they nerfed the old models and gave the new stuff super-OP rules! GW's a business, man! They need to make money!" Or; "Screw balance, you WAAC loser, 40k isn't about competitive play, it's about forging the narrative!" And, you know how they recalled a bunch of Dreadfleet (and whatever other failures they've brought out) for destruction instead of having a massive sale? Or how they never have any sales ever? Yeah. To avoid devaluing their products. GW do both these things simultaneously. Can you see the paradox? They're willfully forgoing revenue to avoid product devaluation ('cause it's a Space Marine Ferrarri, bro), which is fine on its own, while devaluing their product through purposefully making it inferior.
If you could ask any super-successful business-mogul what the first rule of business is, what would they say? Not specifically about their company, but just as a general question. What's the first rule of business?
Don't make it hard for your customers to do business with you?
Have a great product, have the best product?
Forget your pride, do what works?
Embrace the web?
Treat business partners, customers, manufacturers with respect and make them want you to succeed?
Understand your market, and your target audience?
These aren't cherry-picked to fit my point, these are real (well, paraphrased) priorities from people who know what they're talking about. And they're also things GW completely and utterly fail at.
GW have great models, but let's be honest, the rules aren't exactly flawless. Why?
GW don't pay attention to market trends and what competitors are doing to be successful, nor are they allowing their trade partners to maximize their success in their own local areas. Why?
GW treat the internet as inconsequential. Why?
GW have a significant portion of their customer base and potential customer base and former customer base hating them. Why?
Market research is otiose in a niche. Jibber-jabber! Wham-wham! Business! "Our customers' hobby is purchasing our product." Brilliance, straight from the Little Dumb Book of Merrett, under oath.
Supposedly, GW have confirmed for themselves by releasing similar kits in different price points that the price doesn't really make a significant difference to sales.
Wasn't that something along the lines of, making cold ones a bit cheaper but leaving most of the rest of the army to cost a bomb?
Yes, lowering the prices of a couple of items you aren't likely to buy more than one or two of isn't going to improve sales of THAT item. It might slightly improve sales of everything else, but the benefits would be spread out so much they wouldn't be noticeable. The flaws in that scheme keep getting pointed out, and yet still people bring it up.
NoPoet wrote: Has anyone ever done an analysis of what would happen if the GW suddenly started dropping its prices back to, say, year 2000 levels?
Would the increased business make up for the potential losses? Would business actually increase at all? I'm guessing it probably would.
If they just dropped prices by what people feel is acceptable - about 30% or so, without doing anything else they'd just go bust, because they are so bloated they don't have the margins to handle the drop in revenue.
If they were to do it in conjunction with some other improvements like customer involvement, or as said, improve value (putting more mini's in the box for the same price), they'd do a lot better.
I read somewhere that a true businessman will look for fewer, higher value sales than lots of small, cheap sales. But in the UK, the cheap supermarkets selling crap quality products, such as Aldi and Lidl (it's not all crap by any means but it certainly isn't spectacular), are hugely outperforming Morrisons and Tesco, whose quality, and therefore prices, are noticeably higher. The smaller supermarkets are paying staff up to £10 per hour for sitting on a checkout, while Morrisons is not replacing staff who leave and Tesco's expansion plans are up a Snotling's arse.
Aldi (and Lidl, to an extent) dont' sell crap quality stuff though*. They work on a no frills basis; they only stock 1 type of cornflakes (Vs Tesco's 4 or 5), don't stock a lot of branded stuff, they don't give out free bags**, and they keep everything simple (like keeping the big stuff on pallets). It means they need less space, and less overheads, so can sell stuff cheaper.
Tesco is trying to be all things to everyone, so they use a huge space to store essentially redundant products (usually a big brand, little brand, own brand, and no frills) for pretty much everything, so they need 4 times the space Aldi does just to stock things. It's all on shelves so they need an army of shelf stackers, and stuff like bags are rolled into the price.
*I don't find the quality of the random stuff in Lidl to be as good as Aldi. I've bough tonnes of random Aldi stuff (spanner sets etc) without any problems, in fact my workshop is probably about 75% Aldi.
**In England at least, Scotland introduced a 5p minimum charge for plastic bags last year and it's really reduced waste.
Supposedly, GW have confirmed for themselves by releasing similar kits in different price points that the price doesn't really make a significant difference to sales.
Wasn't that something along the lines of, making cold ones a bit cheaper but leaving most of the rest of the army to cost a bomb?
It very much smacks of being an experiment set out to match a predetermined conclusion.
just found out that at a local FLGS the manager was contacted by GW to remove all his WFB stock off the shelves. no explanation, no offer of compensation in any way, just told to take it down. of course he knew it was because of the new edition coming out but not because gw told him!
naturally he told them "no", but seriously? what a ridiculous, entitled, prattish move to pull! no wonder sales continue to fall!
Osbad wrote: just found out that at a local FLGS the manager was contacted by GW to remove all his WFB stock off the shelves. no explanation, no offer of compensation in any way, just told to take it down. of course he knew it was because of the new edition coming out but not because gw told him!
naturally he told them "no", but seriously? what a ridiculous, entitled, prattish move to pull! no wonder sales continue to fall!
RIdiculous really, what was he supposed to do, trash it all and take the hit on himself?
NoPoet wrote: Has anyone ever done an analysis of what would happen if the GW suddenly started dropping its prices back to, say, year 2000 levels?
Would the increased business make up for the potential losses? Would business actually increase at all? I'm guessing it probably would.
If they just dropped prices by what people feel is acceptable - about 30% or so, without doing anything else they'd just go bust, because they are so bloated they don't have the margins to handle the drop in revenue.
If they were to do it in conjunction with some other improvements like customer involvement, or as said, improve value (putting more mini's in the box for the same price), they'd do a lot better.
I read somewhere that a true businessman will look for fewer, higher value sales than lots of small, cheap sales. But in the UK, the cheap supermarkets selling crap quality products, such as Aldi and Lidl (it's not all crap by any means but it certainly isn't spectacular), are hugely outperforming Morrisons and Tesco, whose quality, and therefore prices, are noticeably higher. The smaller supermarkets are paying staff up to £10 per hour for sitting on a checkout, while Morrisons is not replacing staff who leave and Tesco's expansion plans are up a Snotling's arse.
Aldi (and Lidl, to an extent) dont' sell crap quality stuff though*. They work on a no frills basis; they only stock 1 type of cornflakes (Vs Tesco's 4 or 5), don't stock a lot of branded stuff, they don't give out free bags**, and they keep everything simple (like keeping the big stuff on pallets). It means they need less space, and less overheads, so can sell stuff cheaper.
Tesco is trying to be all things to everyone, so they use a huge space to store essentially redundant products (usually a big brand, little brand, own brand, and no frills) for pretty much everything, so they need 4 times the space Aldi does just to stock things. It's all on shelves so they need an army of shelf stackers, and stuff like bags are rolled into the price.
*I don't find the quality of the random stuff in Lidl to be as good as Aldi. I've bough tonnes of random Aldi stuff (spanner sets etc) without any problems, in fact my workshop is probably about 75% Aldi.
**In England at least, Scotland introduced a 5p minimum charge for plastic bags last year and it's really reduced waste.
Supposedly, GW have confirmed for themselves by releasing similar kits in different price points that the price doesn't really make a significant difference to sales.
Wasn't that something along the lines of, making cold ones a bit cheaper but leaving most of the rest of the army to cost a bomb?
It very much smacks of being an experiment set out to match a predetermined conclusion.
On the lidl/aldi comments as far as their meat goes I know they use locally sourced, in the uk at least; beef, chicken and lamb. They pay producers the same as the major super markets and are generally a lot less aggressive to work with. It is far from cheap rubbish with the same products hitting the shelves of tesco, sainsburys, asda and even the pricy Marks and Sparks and waitrose. It's just like GW you pay for a shopping experience. If your into that.....
The whole supermarket dynamic in the UK at the moment actually speaks quite well to what folk have been saying about GW's lack of real direction.
"Cheap" places like Aldi and Lidl who, as Herzlos mentioned, focus on a "no frills" model to sell stuff of reasonable quality as affordably as they can are doing really well. "Posh" places like Waitrose(less so M&S) that sell high quality stuff in a fancy manner are also doing really well. All the outlets which try to offer the "fancy" experience while selling the "no frills" product, which try to make the customer feel like they're buying the higher quality goods even though they actually aren't, they're in serious trouble.
Chiefly because people aren't, in the main, idiots, and even those who are idiots cannot be fooled forever; eventually people will realise they can get the same thing cheaper elsewhere if they just stop pretending that the "experience" is important without the quality to back it up, or they decide they don't want to pretend to buy luxury any more and just go to the place that gives them actual luxury.
GW was all things to all people for a solid amount of time, but they could maintain that state of affairs because A; they actually made an effort to be all things to all people, ie they made multiple products to satisfy different parts of the market, B; competitors found it difficult to break into the market in a sustainable way, and C; their ubiquity and the communities fostered in their multi-man gaming-encouraged stores meant everyone played GW games because everyone already played GW games - you were guaranteed a game if you wanted one, and generally anywhere you went that had a wargaming community would have a substantial GW group to play with.
Their inability to consider their business as an ecosystem rather than a completely disconnected series of individual sales of individual products and their short-termism has put paid to A, Kickstarter and just the internet more generally has dealt with B, and while C has kept them chugging along in combination with the constant, now marrow-deep cost cutting the issues with A and B, and GW's own actions in response, have been steadily eroding away at their market share.
If they want to be around long-term, GW have to figure out what customers they actually want, real customers not the imaginary "GW Hobbyists" who live in Alan Merrett's head, and then tailor their business model accordingly. Right now they're being run exclusively for the benefit of a kind of shareholder that really doesn't give a flying fig whether the company is viable beyond its next dividend payout, and you can't run a business that makes things like that forever.
Supposedly, GW have confirmed for themselves by releasing similar kits in different price points that the price doesn't really make a significant difference to sales.
Wasn't that something along the lines of, making cold ones a bit cheaper but leaving most of the rest of the army to cost a bomb?
I think it started with the Chaos Knights when they went to plastic, but essentially yes.
They significantly dropped the price of one part, while everything else stayed or increased.
This would perhaps have been a benefit for the collecters/painters who ONLY wanted Chaos Knights and nothing else from the Chaos range (ie, no-one).
But (depending on the rules at the time), that won't make gamers rush out to by Knights if Warriors are cheaper instead. And for the person continuing or starting an army, a 50% drop in price on one kit translates into a 2% price drop for the army as a whole.
Some of the plastic kits that were released in 7th were reasonably priced... for GW standards at least. Not "cheap" in any way.
I mean, the 6th edition dark elf corsairs box (10 metal models, 25€, or perhaps it had already jumped up to 28 by then, not sure) was replaced by the 7th edition plastic box (10 models, 21€), which has remained at that prince since. The insane price creep throughout the rest of the range has now left those plastic corsairs as an oddity, because the new plastic kits released in 8th are 40€ (executioners/black guard) or 45€ (witch elves).
4€ or 4'5€ for a plastic infantry plastic model is sheer insanity.
I'm not saying GW's current position is right but even if they:
+Added more staff and expanded their stores
+Cleaned up their rules
+Cut prices of their models
+Supported tournaments and communities
I don't know if the above would improve their profits.
All the above either adds more cost or cuts income, with the hope that customers purchase more volume to make up. But with eBay, proxies, competing war games, video games, etc. - I don't know if customers would actually buy more volume.
Maybe the answer really is to downsize and just focus on the 'collectors'. I don't know, I'm just presenting an alternative.
KiloFiX wrote: I'm not saying GW's current position is right but even if they:
+Added more staff and expanded their stores
+Cleaned up their rules
+Cut prices of their models
+Supported tournaments and communities
I don't know if the above would improve their profits.
All the above either adds more cost or cuts income, with the hope that customers purchase more volume to make up. But with eBay, proxies, competing war games, video games, etc. - I don't know if customers would actually buy more volume.
Maybe the answer really is to downsize and just focus on the 'collectors'. I don't know, I'm just presenting an alternative.
Some of those things could cost GW very little money if they were interested.
They could easily attend conventions- it wouldn't cost that much, and they could sell retail goods there. It would also help add to presence within the community...they would just have to accept they themselves aren't the community/hobby.
Rule fixes I don't think would cost an unbelievable amount. The problem is GW sees the rules as a vehicle for selling models. IMO, that is a dire mistake and will continue to damage the company for years to come, less they rectify it. Destroying the gaming portion will eventually lead to just collectors purchasing models, and I guarantee you that amount of revenue is dramatically lower than what they get now.
As far as their stores go, I think they that they should add a goodly number of their current stores, increase the size of the stores they do keep to 3-5 employees, and make them a more attractive place to visit via tournaments, game space, and an opportunity to buy everything GW works on (including their RPGs, video games, etc.). They should also go back to supporting FLGSs more positively, rather than this adversarial relationship they have now.
Basically, they'd go back to stores they had about ten years ago.
I agree with you that lowering prices probably won't do much to help things. And obviously everything I recommended might not be a cure-all, but the point was more that GW could resolve a lot of their issues if they choose to do so, they just choose not to do these things.
The problem with that is that they were obviously not using the big show environment correctly and to the full extent.
Why were the Gripping Beast, Hawk and Prodos games areas rammed with people constantly throughout the day? It wasn't because they were selling at 10% discount. They had new previews of products on display, 'show only' early releases, the rules writers, developers and sculptors were there to chat with the fans, massive demo games like that of Hawk Wargames with big display pieces. Those companies made an effort and gave a reason for the fans to go their and enjoy their games, and really that's the reason a lot of people attend conventions.
The problem is of course the lack of any pre-release marketing or info prior to a release by GW. Any official presence at Salute would have absolutely nothing to offer in that respect, and if the FW stand was anything to go on (where they had a stand that seemed about 2x2' wide - probably smaller than that of the woman who was selling knitted dice bags - with a few guys being run ragged by people queuing to not pay their P&P charges) it would be as half-arsed as possible. Real shame, because with their financial clout they could have made something really special. Perhaps they just think (which is true to an extent) that they enjoy such a positon of primacy in the sci-fi/fantasy market that they don't need to do any conventions, tournaments etc? Who knows..
Pacific wrote: The problem with that is that they were obviously not using the big show environment correctly and to the full extent.
Why were the Gripping Beast, Hawk and Prodos games areas rammed with people constantly throughout the day? It wasn't because they were selling at 10% discount. They had new previews of products on display, 'show only' early releases, the rules writers, developers and sculptors were there to chat with the fans, massive demo games like that of Hawk Wargames with big display pieces. Those companies made an effort and gave a reason for the fans to go their and enjoy their games, and really that's the reason a lot of people attend conventions.
The problem is of course the lack of any pre-release marketing or info prior to a release by GW. Any official presence at Salute would have absolutely nothing to offer in that respect, and if the FW stand was anything to go on (where they had a stand that seemed about 2x2' wide - probably smaller than that of the woman who was selling knitted dice bags - with a few guys being run ragged by people queuing to not pay their P&P charges) it would be as half-arsed as possible. Real shame, because with their financial clout they could have made something really special. Perhaps they just think (which is true to an extent) that they enjoy such a positon of primacy in the sci-fi/fantasy market that they don't need to do any conventions, tournaments etc? Who knows..
Fenrir Kitsune wrote: When they used to be at Salute, the stall was empty. Why buy at full RRP when theres a hall full of people selling the same stuff at discount?
They're the boss. They set the rules.
They may not wish to discount, even at conventions, because of the somewhat misguided belief that their brand has any value, but they can fill the stand with items other retailers won't typically carry, such as the command tanks and various kits that are usually special order/direct only, or even make event only items like FW do.
Or they could simply forget about sales, employ the massive resources they have at their disposal in comparison to other companies and build an awesome display and use the day to reconnect with their customer base and energise them to get involved with their product. It doesn't matter where people buy GW product from, GW still wins.
I hit the GW/FW booth up at GenCon each year for a t-shirt, some novelty (mug, button, etc), and the event-only gak. Sometimes I buy an IA or HH book because it saves on shipping and I'm buying the fether from FW anyway. I never get a chance to just hang around and talk shop. I think enough people do that so I leave them alone and go pester Kyle at the battlefoam booth. He's a funny fether.
Fenrir Kitsune wrote: When they used to be at Salute, the stall was empty. Why buy at full RRP when theres a hall full of people selling the same stuff at discount?
It wouldn't be fair for them to sell the same stuff that their 3rd parties are doing, discount or not. But they could always take some of the 1000 online-only items along, that years show only minis and have some sort of teaser even if it's only a week or 2 out. Or bring in one of the authors to sign books or something. Plenty of things they could do.
KiloFiX wrote: All the above either adds more cost or cuts income, with the hope that customers purchase more volume to make up. But with eBay, proxies, competing war games, video games, etc. - I don't know if customers would actually buy more volume.
The problem isn't just getting customers to spend more. Particularly when you're talking about a game that needs a healthy community behind it to keep expanding, you need to get more customers.
What we've been seeing in the last few financial reports is a shrinking market. GW need to get people back into the fold, and their current direction just isn't doing that.
GW has enormous power to encourage and direct the community in a positive way, and it's incredibly frustrating that they seem to be heading as fast as possible in the opposite direction, trying to make their games back into something played by a handful of people in their living rooms.
KiloFiX wrote: I'm not saying GW's current position is right but even if they:
+Added more staff and expanded their stores
+Cleaned up their rules
+Cut prices of their models
+Supported tournaments and communities
I don't know if the above would improve their profits.
All the above either adds more cost or cuts income, with the hope that customers purchase more volume to make up. But with eBay, proxies, competing war games, video games, etc. - I don't know if customers would actually buy more volume.
Maybe the answer really is to downsize and just focus on the 'collectors'. I don't know, I'm just presenting an alternative.
You know the old adage, "You have to spend money to make money"
KiloFiX wrote: All the above either adds more cost or cuts income, with the hope that customers purchase more volume to make up. But with eBay, proxies, competing war games, video games, etc. - I don't know if customers would actually buy more volume.
The problem isn't just getting customers to spend more. Particularly when you're talking about a game that needs a healthy community behind it to keep expanding, you need to get more customers.
What we've been seeing in the last few financial reports is a shrinking market. GW need to get people back into the fold, and their current direction just isn't doing that.
GW has enormous power to encourage and direct the community in a positive way, and it's incredibly frustrating that they seem to be heading as fast as possible in the opposite direction, trying to make their games back into something played by a handful of people in their living rooms.
That's one of the things about an exclusive product/service, you only get a handful of people engaging in it. So by driving away customers, they're making their product more exclusive and therefore increasing the value of it. The logic is there, even if twisted. Of course, it goes with the rumour that the current board don't/didn't want the product to become too popular, as then the shareholders might have replaced them with a more experienced board. I'm interested to see what direction they'll head in when kirby finally retires, or if there's a direction left to head in at that point.
From the company's point of view it doesn't matter if the profit is made from boutique collectables or from mass market appeal, so long as the profit is there.
KiloFiX wrote: I'm not saying GW's current position is right but even if they:
+Added more staff and expanded their stores
+Cleaned up their rules
+Cut prices of their models
+Supported tournaments and communities
I don't know if the above would improve their profits.
All the above either adds more cost or cuts income, with the hope that customers purchase more volume to make up. But with eBay, proxies, competing war games, video games, etc. - I don't know if customers would actually buy more volume.
Maybe the answer really is to downsize and just focus on the 'collectors'. I don't know, I'm just presenting an alternative.
You know the old adage, "You have to spend money to make money"
I think GW prefers the old adage, "Mo' money, mo' problems."
KiloFiX wrote: I'm not saying GW's current position is right but even if they:
+Added more staff and expanded their stores
+Cleaned up their rules
+Cut prices of their models
+Supported tournaments and communities
I don't know if the above would improve their profits.
All the above either adds more cost or cuts income, with the hope that customers purchase more volume to make up. But with eBay, proxies, competing war games, video games, etc. - I don't know if customers would actually buy more volume.
Maybe the answer really is to downsize and just focus on the 'collectors'. I don't know, I'm just presenting an alternative.
I tend to agree. I think GW is a bit overgrown, short of accepting they aren't a big player any more and shrinking their outlay to compensate, I think they are going to struggle.
KiloFiX wrote: I'm not saying GW's current position is right but even if they:
+Added more staff and expanded their stores
+Cleaned up their rules
+Cut prices of their models
+Supported tournaments and communities
I don't know if the above would improve their profits.
All the above either adds more cost or cuts income, with the hope that customers purchase more volume to make up. But with eBay, proxies, competing war games, video games, etc. - I don't know if customers would actually buy more volume.
Maybe the answer really is to downsize and just focus on the 'collectors'. I don't know, I'm just presenting an alternative.
GW needs to follow WOTC's lead on how they handled a similar situation back in the 2000s. WOTC had their own stores and many of the same problems GW has currently. WOTC chose to close their stores, make friends with the FLGSs, increase their tournament support and tighten up their rules. From all indications, this worked out well as WOTC is fairly successful.
GW needs to close their stores (online and brick and mortar)
GW needs to make friends with the FLGS owners
GW needs to tighten up and modernize their rules
GW needs to have better tournament support
It looks like this graph will just be extended on for another year in the expected (downwards) direction.
At least they've given up blaming the bursting of the LotR bubble, although I expect they'd blame the bursting of the Hobbit bubble if there'd ever been one to burst ...
KiloFiX wrote: I'm not saying GW's current position is right but even if they:
+Added more staff and expanded their stores
+Cleaned up their rules
+Cut prices of their models
+Supported tournaments and communities
I don't know if the above would improve their profits.
All the above either adds more cost or cuts income, with the hope that customers purchase more volume to make up. But with eBay, proxies, competing war games, video games, etc. - I don't know if customers would actually buy more volume.
Maybe the answer really is to downsize and just focus on the 'collectors'. I don't know, I'm just presenting an alternative.
GW needs to follow WOTC's lead on how they handled a similar situation back in the 2000s. WOTC had their own stores and many of the same problems GW has currently. WOTC chose to close their stores, make friends with the FLGSs, increase their tournament support and tighten up their rules. From all indications, this worked out well as WOTC is fairly successful.
GW needs to close their stores (online and brick and mortar)
GW needs to make friends with the FLGS owners
GW needs to tighten up and modernize their rules
GW needs to have better tournament support
More accurately, Hasbro decided to cut WotC's brick and mortar stores.
They wanted WotC for their IP, not their physical properties.
2014
123.5 million in sales
the breakdown in sales can be found on page 8 of the annual report
42% is hobby centres - 51.87 million
36% is trade - 44.46 million
9% is mail order - 11.12 million
the remaining 13% is black library and forgeworld.
A 5% reduction in hobby centres is - 49.28 million
A 3% reduction in trade is 43.12 million
A 5% increase in mail order 11.67 million
Assume stability from forgeworld and black library because it is not noted as significant - 16.01 million
Therefore, annual Sales in 2015 - 120.12 (note there is some rounding in the numbers above, so this might not equal that, but does in my spreadsheet). So down 3.4 million, or a 2.7% loss in revenue, which is a damn sight better than the 8.2% of 2013 to 2014. Still not a growth position, and hardly a complete picture without expenses factored in... but loss of sales, at least, appears to be decelerating.
Would love to see a 40K to Fantasy to LOTR to Forgeworld lens publically applied to their reporting as well, including cost allocations for development and storage of product... but that is wishful thinking...
One more caveat that I don't care to figure out - it could be a 5.4% and 3.4% reduction and a 4.6% increase in the respective areas, which would reduce revenue by a fair amount (+/- 475,000 or so).
Can't argue with the logic, if the figures are at least a little bit assumption.
If they've managed to find at least a few million in economies, it could be another year of getting away with it, but this year has seen them pull the trigger on some awfully big ammunition, so once again, we'll be looking at the next year thinking "what can they possibly do to prop up the sales this year" but with fewer options.
I would love for them to realize as a company that they are first a game company second a collectable model company. I have enjoyed GW since the end of 3rd edition up to the present. And I could only hope they find their way back to what they used to be. Like across the board price drop to get new blood into the game. Older players would not giving a second thought to picking up that new box of models that just came out or picking up another army on impulse. Lastly putting support in the tournament scene again and showing the customers that they still care about us.
Therefore, annual Sales in 2015 - 120.12 (note there is some rounding in the numbers above, so this might not equal that, but does in my spreadsheet). So down 3.4 million, or a 2.7% loss in revenue, which is a damn sight better than the 8.2% of 2013 to 2014. Still not a growth position, and hardly a complete picture without expenses factored in... but loss of sales, at least, appears to be decelerating.
Would love to see a 40K to Fantasy to LOTR to Forgeworld lens publically applied to their reporting as well, including cost allocations for development and storage of product... but that is wishful thinking...
One more caveat that I don't care to figure out - it could be a 5.4% and 3.4% reduction and a 4.6% increase in the respective areas, which would reduce revenue by a fair amount (+/- 475,000 or so).
Cheers,
Nate
Annual General Report hasn't been released yet. So how did you come by these numbers.
Therefore, annual Sales in 2015 - 120.12 (note there is some rounding in the numbers above, so this might not equal that, but does in my spreadsheet). So down 3.4 million, or a 2.7% loss in revenue, which is a damn sight better than the 8.2% of 2013 to 2014. Still not a growth position, and hardly a complete picture without expenses factored in... but loss of sales, at least, appears to be decelerating.
Would love to see a 40K to Fantasy to LOTR to Forgeworld lens publically applied to their reporting as well, including cost allocations for development and storage of product... but that is wishful thinking...
One more caveat that I don't care to figure out - it could be a 5.4% and 3.4% reduction and a 4.6% increase in the respective areas, which would reduce revenue by a fair amount (+/- 475,000 or so).
Cheers,
Nate
Annual General Report hasn't been released yet. So how did you come by these numbers.
The OP gave the percentages for 2015 which were taken from the GW press announcement. The numbers from 2014 I assume came from the 2014 annual report.
The effect of these non-core activities and the continuing effects of unfavourable exchange rates mean that our reported sales are likely to show small declines in retail (c.5%) and trade (c.3%). Mail order growth was c.5%.
carlosthecraven wrote: Therefore, annual Sales in 2015 - 120.12 (note there is some rounding in the numbers above, so this might not equal that, but does in my spreadsheet). So down 3.4 million, or a 2.7% loss in revenue, which is a damn sight better than the 8.2% of 2013 to 2014. Still not a growth position, and hardly a complete picture without expenses factored in... but loss of sales, at least, appears to be decelerating.
Just thought i'd touch on this. First half wasn't too good, inline with the general direction of last year. So between then and now they've been firing their big guns with lots of 40k releases like adeptus mechanicus, etc, and they're still in decline. How many big guns do you think they have left? We heard rumours of genestealer cult army, there's the new fantasy (which i predict will do poorly) and that only leaves another reboot of 40k that i can see.
2014
123.5 million in sales
the breakdown in sales can be found on page 8 of the annual report
42% is hobby centres - 51.87 million
36% is trade - 44.46 million
9% is mail order - 11.12 million
the remaining 13% is black library and forgeworld.
A 5% reduction in hobby centres is - 49.28 million
A 3% reduction in trade is 43.12 million
A 5% increase in mail order 11.67 million
Assume stability from forgeworld and black library because it is not noted as significant - 16.01 million
Therefore, annual Sales in 2015 - 120.12 (note there is some rounding in the numbers above, so this might not equal that, but does in my spreadsheet). So down 3.4 million, or a 2.7% loss in revenue, which is a damn sight better than the 8.2% of 2013 to 2014. Still not a growth position, and hardly a complete picture without expenses factored in... but loss of sales, at least, appears to be decelerating.
Would love to see a 40K to Fantasy to LOTR to Forgeworld lens publically applied to their reporting as well, including cost allocations for development and storage of product... but that is wishful thinking...
One more caveat that I don't care to figure out - it could be a 5.4% and 3.4% reduction and a 4.6% increase in the respective areas, which would reduce revenue by a fair amount (+/- 475,000 or so).
Cheers,
Nate
It's a bit ambiguous in the press release, but the decline percentages you're operating with most likely refer to constant currency (which is GW pretending what life would be like if the Euro hadn't fallen into a deep hole). The half-year report shows they had already had a decline in revenue by £4m in the first half of the year, so if they had turned the trend and started growing again for a total annual decline of only £3.4m you can be pretty sure the wording would have been very different.
It's a bit ambiguous in the press release, but the decline percentages you're operating with most likely refer to constant currency (which is GW pretending what life would be like if the Euro hadn't fallen into a deep hole). The half-year report shows they had already had a decline in revenue by £4m in the first half of the year, so if they had turned the trend and started growing again for a total annual decline of only £3.4m you can be pretty sure the wording would have been very different.
I agree with this completely. The release would have been worded much more positively if they had been able to turn things around strongly enough to significantly slow the slide that has been occurring over the last several reports and most notably accelerating in the past year and a half. My take on the wording of the press release is that it's a, not untruthful, statement of accounts to forestall an exodus such as occurred Jan 2014. The boggling thing is that anyone with a modicum of financial expertise (me) can read through the statement so I'm a bit puzzled why they bothered, considering their largest investors are institutional and mainly in it for the dividends.
Possibly because they are so small most of the investors won't give it more than a cursory glance from one of the interns waiting on the kettle to boil.
It's still $150 million, I know that's not Rio Tinto Zinc but it's hardly pocket change either.
If the funds are unconcerned I suspect it is because as you say they are only interested in dividends and GW is always good at issuing dividends. On at least one occasion they borrowed the cash to give a dividend because they had lost too much money that year.
I know nothing about this service or how to interpret the information contained within the page, but it's analysis shows a 70% chance of GW going bankrupt in the next two years.
I know nothing about this service or how to interpret the information contained within the page, but it's analysis shows a 70% chance of GW going bankrupt in the next two years.
Anybody able to add some insight here please?
Not a chance. They've just spent £4m extending warhammer world. If they were that close to bankruptcy they wouldn't be investing that much in a venue that accounts for less than 5% of their annual turnover
I agree with youR conclusion, but not necessarily with your method.
It brings to mind a story my economics teacher once (actually, repeatedly!) told about how a class of students were given a set of accounts to study, with a view to deciding if the company was in sufficiently good shape to borrow money from the bank the students hypothetically worked for. Something like 80% of the students decided that they'd be happy to loan the company money on the basis of their accounts.
The accounts were taken from a company that went bankrupt shortly after (it may have been the next day, memory is hazy.)
I personally worked for a company where I closed up and went home on the Thursday, found an email on the Friday instructing us managers not to open up, only to be summoned to a meeting later that morning to be told the company had gone bankrupt.
Suffice to say, current behaviour isn't any sort of indicator of future performance.
I admit I don't know much of anything about renovations, but how reasonable is that amount? I'm just thinking of the 4 million pound website update from a couple of years back, which by all accounts seemed significantly overpriced. Glad they're updating WW and such, I just sometimes get the feeling that they're trying to generate these significant one-time costs to help explain away the year-on-year decreasing revenue.
Azreal13 wrote: Well, they're valuing GW shares at £500 rather than £5 by the looks of it. (LSE lists in pence, not pounds, whereas the NYSE lists in dollars.)
So that'd immediately undermine my confidence in their info!
I know what you mean, but to my knowledge the work was paid for directly, not from loans. Given that most of the shareholders are insurance companies, if the market trend showed bankruptcy as likely in that time frame, and the board decided to make an investment of that size on a venture that would take over the suggested two years to recover, there would be a vote of no confidence and the CEO replaced. Although the CEO who was in place when the work began has stepped down, it isn't because of that.
All that said, I completely accept the point of market instability, and will acknowledge that any thing can happen. I just don't think it likely.
JamesY wrote: Not a chance. They've just spent £4m extending warhammer world. If they were that close to bankruptcy they wouldn't be investing that much in a venue that accounts for less than 5% of their annual turnover
Wait. I thought the 4 million was for the website and tools.
Accolade wrote: I admit I don't know much of anything about renovations, but how reasonable is that amount? I'm just thinking of the 4 million pound website update from a couple of years back, which by all accounts seemed significantly overpriced. Glad they're updating WW and such, I just sometimes get the feeling that they're trying to generate these significant one-time costs to help explain away the year-on-year decreasing revenue.
No as you can see it is their turnover which is decreasing, in house expenditures will only dictate how much of that turnover is profit. The expenses can't cover the fact that the sales are dropping.
I've not visited WHW, but my understanding is the renovations have been fairly substantial? (Seem to remember that "Warhammerfest" was expected to take place there etc?)
That said £4m is a lot to spend when you're not buying land or property.
New front, miniature hall massively extended up and backwards, three new store fits, 10-15 painters working for a year painting the displays, relaying the car park etc. It's been a big job, and all the while tram works beginning done right outside, god knows how many delays that caused.
Accolade wrote: Glad they're updating WW and such, I just sometimes get the feeling that they're trying to generate these significant one-time costs to help explain away the year-on-year decreasing revenue.
I had that feeling too, and I'm still suspicious if the WHW refit was to make it a more generic exhibition style building to make it easier to sell in future.
Accolade wrote: I admit I don't know much of anything about renovations, but how reasonable is that amount? I'm just thinking of the 4 million pound website update from a couple of years back, which by all accounts seemed significantly overpriced. Glad they're updating WW and such, I just sometimes get the feeling that they're trying to generate these significant one-time costs to help explain away the year-on-year decreasing revenue.
No as you can see it is their turnover which is decreasing, in house expenditures will only dictate how much of that turnover is profit. The expenses can't cover the fact that the sales are dropping.
@ bginer. Pretty much yeah.
Oh I understand expenses only impact overall profit generation, I'm just thinking about Tom Kirby's inane preambles, which always come with blaming some circumstance for the loss in revenue. A couple of years back, it was the website, and then the past year it was the individual store manager's faults for things not being more positive.
It just seems like these items get thrown up as a smoke screen for investors who only take a couple of glances at what is going on and not bother to check the numbers.
It's pretty cool that there is such a place in the world, anywhere, by any company I wish I were headed out towards Nottingham so that I could check it out
Accolade wrote: Glad they're updating WW and such, I just sometimes get the feeling that they're trying to generate these significant one-time costs to help explain away the year-on-year decreasing revenue.
I had that feeling too, and I'm still suspicious if the WHW refit was to make it a more generic exhibition style building to make it easier to sell in future.
There were a few reasons, one of the main being that its purpose as an international visitors centre wasn't really happening, instead a lot of the local gamers take it for granted that it is their gaming space. It's a big step towards returning it to its original function, and it is fantastic.
@ accolade yeah your last point is probably right and typical of all limited companies trying to spin poor performance.
It certainly makes sense for them to host their own events in space they already own; it cost them a fortune shipping everything to Birmingham. I'm just wary about it becoming very generic instead of the old castle it used to be.
I'm going to visit in August, so looking forward to seeing what's new.
I was there some years ago and the miniature hall was impressive. Also the food was good and well priced. They used to have a large display area with near-life size models and the huge gameday displays but they scrapoed them all sadly.
Skimming through all 10 pages, I'm amused by how many people on Dakka clearly have no financial or investing background, and act as if they do...
Edit: FYI, spoke to a pretty senior GW guy some time back. LOTR apparently generates boatloads of revenue for them in certain markets, and is partly the reason why GW has been able to undertake so many risky things with 40k and still survive.
Howard A Treesong wrote: I was there some years ago and the miniature hall was impressive. Also the food was good and well priced. They used to have a large display area with near-life size models and the huge gameday displays but they scrapoed them all sadly.
There are all new ones in the exhibition hall now. And the biggest is the size of a small flat.
Accolade wrote: Glad they're updating WW and such, I just sometimes get the feeling that they're trying to generate these significant one-time costs to help explain away the year-on-year decreasing revenue.
I had that feeling too, and I'm still suspicious if the WHW refit was to make it a more generic exhibition style building to make it easier to sell in future.
There were a few reasons, one of the main being that its purpose as an international visitors centre wasn't really happening, instead a lot of the local gamers take it for granted that it is their gaming space. It's a big step towards returning it to its original function, and it is fantastic.
International visitors centre? Is that really a big deal? What kind of international traffic do they think they're going to generate in Lenton? It's GW prime for Gods sake, not The Hague!
Are there any before and after pictures anywhere? I've never been, and I'd love to see what's there. I can't find anything on the GW site.
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Enigwolf wrote:Edit: FYI, spoke to a pretty senior GW guy some time back. LOTR apparently generates boatloads of revenue for them in certain markets, and is partly the reason why GW has been able to undertake so many risky things with 40k and still survive.
Could you offer any more information? I find this interesting, especially if this treasure trove of sales is enough to buffer losses in 40K sales.
Or are you talking about when the movies where in the theatre? If so, that bubble has long burst.
International visitors centre? Is that really a big deal? What kind of international traffic do they think they're going to generate in Lenton? It's GW prime for Gods sake, not The Hague!
If they're calling it an international visitors center, that's a joke lol. I was there for one of their event days over the summer 2-ish years ago - I was the only American there, I think. And everyone in that town were looking at me as if they'd never seen a non-Brit before.
Enigwolf wrote:Edit: FYI, spoke to a pretty senior GW guy some time back. LOTR apparently generates boatloads of revenue for them in certain markets, and is partly the reason why GW has been able to undertake so many risky things with 40k and still survive.
Could you offer any more information? I find this interesting, especially if this treasure trove of sales is enough to buffer losses in 40K sales.
Or are you talking about when the movies where in the theatre? If so, that bubble has long burst.
No. I specifically asked the guy (he's a senior regional director or something) why LotR/Hobbit was still being kept as a product line, and made some snide remarks about how it was probably eating away at their profit line but they were trying to recoup losses from the cost of licensing (typical anti-GW me). His answer was the exact opposite of what I expected - in certain markets (I can't say which, in order not to compromise his identity) LotR sold like hot-cakes. There was a little bit of a drop after the movies were long out (like you were mentioning about the bubble) but LotR still kept enough of a following to sustain itself while things like Specialist Games died. When the Hobbit was later released, their sales jumped again.
I don't know what else you want to know from that, is there something specifically?
If they're calling it an international visitors center, that's a joke lol. I was there for one of their event days over the summer 2-ish years ago - I was the only American there, I think. And everyone in that town were looking at me as if they'd never seen a non-Brit before.
Lol.
Not sure if Lenton is worth to travel there. I guess not.
I'm missing the German HQ in Düsseldorf. A world-open city and a nice place for a GT.
International visitors centre? Is that really a big deal? What kind of international traffic do they think they're going to generate in Lenton? It's GW prime for Gods sake, not The Hague!
If they're calling it an international visitors center, that's a joke lol. I was there for one of their event days over the summer 2-ish years ago - I was the only American there, I think. And everyone in that town were looking at me as if they'd never seen a non-Brit before.
Well that was kind of the problem, it was always the same people dominating the space and treating it like it was theirs. It's not Disney land, but it does get visitors from all over. Not so much at events that require the transportation of an army though. I was in the Nottingham store and was forever giving hobbyist tourists directions.
International visitors centre? Is that really a big deal? What kind of international traffic do they think they're going to generate in Lenton? It's GW prime for Gods sake, not The Hague!
If they're calling it an international visitors center, that's a joke lol. I was there for one of their event days over the summer 2-ish years ago - I was the only American there, I think. And everyone in that town were looking at me as if they'd never seen a non-Brit before.
Enigwolf wrote:Edit: FYI, spoke to a pretty senior GW guy some time back. LOTR apparently generates boatloads of revenue for them in certain markets, and is partly the reason why GW has been able to undertake so many risky things with 40k and still survive.
Could you offer any more information? I find this interesting, especially if this treasure trove of sales is enough to buffer losses in 40K sales.
Or are you talking about when the movies where in the theatre? If so, that bubble has long burst.
No. I specifically asked the guy (he's a senior regional director or something) why LotR/Hobbit was still being kept as a product line, and made some snide remarks about how it was probably eating away at their profit line but they were trying to recoup losses from the cost of licensing (typical anti-GW me). His answer was the exact opposite of what I expected - in certain markets (I can't say which, in order not to compromise his identity) LotR sold like hot-cakes. There was a little bit of a drop after the movies were long out (like you were mentioning about the bubble) but LotR still kept enough of a following to sustain itself while things like Specialist Games died. When the Hobbit was later released, their sales jumped again.
I don't know what else you want to know from that, is there something specifically?
No, just really surprised that LoTR was still a thing I suppose. Not even sure why I'm surprised now that I think about it, I mean odd's on the game is still popular somewhere. I've never seen anybody playing it though so I'm sure that colours my perception.
The game cannot 'sell like hot cakes'. That's BS, no matter who you heard it from.
We know that 40K is more than 50% of GW's revenue, not including Black Library, Forge World, Licensing, Video Games, Hobby Supplies, One off games, Warhammer Fantasy, LOtR, and Hobbit.
Someone with more time than me can look at the financials and tack rough dollar amounts onto some of those categories. We know anecdotally that LOtR is dead in the U.S., GW's biggest market, and dead or dying in the UK. We know that NoSLOtR is DIRT cheap on EBay, meaning it is an undesirable product that is absurd to buy from GW at full retail if you actually want to buy it.
I'm sorry, but unless you show me the Devil enjoying a snoball in Hell, I've got to say that's total BS. That or 'hot cakes' does not mean 'is profitable company wide' to your contact.
I mean, how much do they even carry in their own shops nowadays? Assuming most LotR is now direct only, that means LotR constitutes a share of 20% of GW's revenue, a share that also includes FW, BL, and all direct WHFB and 40K sales.
That, by even the loosest definition, cannot be hot cakes.
Most likely! Plus, while we're on the topic of that post..
Enigwolf wrote: Skimming through all 10 pages, I'm amused by how many people on Dakka clearly have no financial or investing background, and act as if they do...
Nope.
You don't get to make comments like this and be taken seriously unless you're willing to share where you're making those observations with the rest of the class, otherwise we'll just assume you don't understand what people are saying and this have decided they're speaking nonsense.
Enigwolf wrote: No. I specifically asked the guy (he's a senior regional director or something) why LotR/Hobbit was still being kept as a product line, and made some snide remarks about how it was probably eating away at their profit line but they were trying to recoup losses from the cost of licensing (typical anti-GW me). His answer was the exact opposite of what I expected - in certain markets (I can't say which, in order not to compromise his identity) LotR sold like hot-cakes. There was a little bit of a drop after the movies were long out (like you were mentioning about the bubble) but LotR still kept enough of a following to sustain itself while things like Specialist Games died. When the Hobbit was later released, their sales jumped again.
I don't know what else you want to know from that, is there something specifically?
a) Who were you talking to? This matters.
b) What was the setting? This matters.
c) What did you expect him to say "Oh yeah LOTR is totally screwed, we're just putting in a token effort now because we're obligated, but it's totally down the toilet". Unless this guy is a very close friend of yours (drinking buddy or something, in which case that comes with its own problems) I fully don't expect him to give an honest answer when the honest answer puts the company, products or associates of the company in a bad light.
I'd easily believe that in some markets LOTR still sells. Many things still sell great...in some place.
-I know one retailer selling Spellfire cards to Poland and Germany and making good money. Buy a collection for 10.00 for thousands of cards since it's long out of print crap, get several hundred to those few collectors left.
-Another is selling Doomtrooper cards to the Slovak countries and Poland.
-I sold one box of sabertooth LOTR ROTK models, the hex based stuff, for 175.00 on ebay. Wish like hell i had more than one.
Variation in local markets can be extreme depending on local gamers, and whether the game caught on years ago, or is just catching on. And LOTR has always had a "non-gamer" following of collectors. So it's quite possible that in some markets it does sell like hotcakes. (whatever 'sells like hotcakes is defined as ).
But.....GW always lies with statistics. They do it several ways. Sometimes they pick out certain things to talk about. More often its that these middle managers and redshirts don't know crap about statistics, and paraphrase what they heard.
Gamers do the same thing, all the time, (examples in this thread, and every financial thread.) When my GW rep tries to give me numbers I push for the data, and don't believe a damn thing from most of them.
Bottom line: Lotr, hotcakes, etc doesn't matter. Sales are down overall.
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a) Who were you talking to? This matters.
b) What was the setting? This matters.
c) What did you expect him to say "Oh yeah LOTR is totally screwed, we're just putting in a token effort now because we're obligated, but it's totally down the toilet". Unless this guy is a very close friend of yours (drinking buddy or something, in which case that comes with its own problems) I fully don't expect him to give an honest answer when the honest answer puts the company, products or associates of the company in a bad light.
QFT!
especially C. GW managers and execs always have to watch their backs and spin things to make sure it looks like a good decision, no matter what.
mikhaila wrote: I'd easily believe that in some markets LOTR still sells. Many things still sell great...in some place.
Oh yeah, I can believe that in some locations LOTR is still going strong, but in the context of the company as a whole? It sounds more like a canned response in order to not put things in a bad light rather than an honest response to the overall state of the game.
weeble1000 wrote: We know anecdotally that LOtR is dead in the U.S., GW's biggest market, and dead or dying in the UK. We know that NoSLOtR is DIRT cheap on EBay, meaning it is an undesirable product that is absurd to buy from GW at full retail if you actually want to buy it.
These 2 points are what make me think it's nonsense. In the UK, the Hobbit LE set still hasn't sold out (link) and film 3 is now available on DVD.
If LOTR was particularly popular anywhere in the world, someone would be snapping up the stuff from eBay, but it goes for almost nothing.
Sure, some of the older rare metals go for a lot to collectors, but are there enough collectors to keep GW propped up now?
We sold a fair amount of old LOTR stuff at a fleamarket a few months ago and there was certainly demand, but it was all OOP metal from the 00's and selling for maybe £25 of new price. We couldn't even give away the plastics.
Azreal13 wrote: Most likely! Plus, while we're on the topic of that post..
Enigwolf wrote: Skimming through all 10 pages, I'm amused by how many people on Dakka clearly have no financial or investing background, and act as if they do...
Nope.
You don't get to make comments like this and be taken seriously unless you're willing to share where you're making those observations with the rest of the class, otherwise we'll just assume you don't understand what people are saying and this have decided they're speaking nonsense.
lol. QFT. I'm no financial expert but it doesn't take one to examine financial reports from a publicly traded company and add 2+2. Sales being down overall across the company and 40K being the primarily supported property of GW tells anyone with 1/2 a brain what the primary cash maker for GW is. When was the last LoTR release? Lack of support should tell you something.....if you're actually paying attention to real data rather than what someone from the company says.
I get not putting too much stock in what random people, who you don't know from Adam, are saying on the internet but that doesn't mean that you should turn your brain off when someone with a vested interest in spinning bad data says something so off-base with observable reality. Obviously if any of GW's properties were "selling like hotcakes", the company's sales volume wouldn't be so abysmal.
International visitors centre? Is that really a big deal? What kind of international traffic do they think they're going to generate in Lenton? It's GW prime for Gods sake, not The Hague!
If they're calling it an international visitors center, that's a joke lol. I was there for one of their event days over the summer 2-ish years ago - I was the only American there, I think. And everyone in that town were looking at me as if they'd never seen a non-Brit before.
Well that was kind of the problem, it was always the same people dominating the space and treating it like it was theirs. It's not Disney land, but it does get visitors from all over. Not so much at events that require the transportation of an army though. I was in the Nottingham store and was forever giving hobbyist tourists directions.
It is reasonable that locals are going to use it most. A bit sad though but somehow typical of NuGW that they would go to a lot of trouble to kick a load of keen fans out of their gaming space.
Back on topic, I am interested to hear that it is LoTR sales that are propping up the rest of the company. They really will be in trouble once the wind falls out of those sails.
I've been to Warhammer world several times, the first was at least 15 years ago, last time was just over four years ago. It's never been very busy and in later times they had a vast number of tables of which only a few were being used. I never saw anyone dominating anything. A few people livening it up a bit would be better.
Howard A Treesong wrote: I've been to Warhammer world several times, the first was at least 15 years ago, last time was just over four years ago. It's never been very busy and in later times they had a vast number of tables of which only a few were being used. I never saw anyone dominating anything. A few people livening it up a bit would be better.
Yup, last time I went was a couple of years ago. The fact they had so much spare tables (and scenery!) was the reason we were allowed to play a load of games of Epic. They even dug out the 6mm terrain for us.
Same reason my friend was able to get away with using some Cryx Bile Thralls as counts as Flamers in his Nurgle Daemon army. In such a big hall you're hidden away and certain things can be made less obvious.
They don't monitor the halls, I've played necromunda with third party scenery (with permission), and the only person to complain was another gamer I didn't even know.
The regulars aren't really a problem, and they will keep going until they start charging for table usage.
To answer the questions, the person I spoke to was a senior regional director, one of the guys in charge of the Asia-Pacific Region. He was at our FLGS for a meeting with distributors some time back. The central and east Asia market actually consumes a lot of LotR - outsells all of their other product lines, actually.
This is the internet, believe me or don't believe me, that's your choice - I'm just sharing what I heard and I have no reason to cook up something like that. Shrug, I couldn't care less. I was one of the early anonymous rumor reporters that told Natfka about the mass Finecast->Plastic-maybe-resin switch back in '12.
Blacksails wrote: Do we know how much the asia-pacific region represents of their total revenue?
It's the smallest region in terms of revenue. Tau were made purely to appeal to that market. They are fortunate that the animae explosion happened in western markets.
Blacksails wrote: Do we know how much the asia-pacific region represents of their total revenue?
Yes. It's a fraction of the revenues of the other regions (in comparison), and now that I'm re-reading the posts above, I realize I'm being misunderstood. I intended to mean that the Asia-Pacific sales profits covered the developmental costs for their "riskier" ventures, not the loss in sales from the risky ventures (difference in the two). I can't find the annual reports from way back when LotR was released, but if you look at the '11-'12 and '12-'13 financials, Asia-Pacific had the highest % jump in sales numbers, coinciding with The Hobbit. I was told that while The Hobbit and LotR wasn't popular in in-store games, its very popular amongst the at-home crowd, which is why you don't see it being played in stores. Frankly, I've never seen a single game of LotR played, and I've been around since its release.
