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From our friends over at TTGN:

http://www.tabletopgamingnews.com/2010/05/13/36088

NOW...

This is, I think, useful information.

We'll see how long this can stay open...

what Gw raising prices? what a suprise. Hope they start taking blood and babies.

Alpharius wrote:We'll see how long this can stay open...

fire4effekt wrote: Hope they start taking blood and babies.

not helpful at all, fire.

The prices don't look horrible, overall. Would've preferred not to have them, but it won't break the bank. Fewer items were increased compared to the Brits.

The books are getting really pricey, though.

Copy, add your name to the bottom and email to GW customer service. If we get enough people in on this, maybe something will happen...

*My whole gaming group supports this!
-Unkle Jack

To Whom it may concern:

I'm writing to let you know that I am very disappointed in Games Workshop for even considering another price increase. I've been a consumer of Games Workshop products for 10 years now and have accumulated 6 fully playable armies in that time. I've not only purchased models to create these armies, but I've purchased White Dwarf magazines, paint, every codex you've created and a number of accessories to make my battlefields more realistic. All of this adds up to thousands of dollars spent.

At this point, however, I think I am at the end of the road with regard to my relationship with Games Workshop. I was fully intending on starting a Blood Angles army (my 7th army) and when finished with that, moving on to either Inquisition or a second Chaos army- but with these price increases, I won't be buying Games Workshop products anymore. In my opinion, Games Workshop is no longer interested in making a great game for people to enjoy. Instead, GW is only interested in squeezing the fanbase for every single bit of cash GW can get. And I am simply not going to be involved with this anymore. While this letter doesn't seem very intimidating, I want you to know that I am not alone. Below are my friends with whom I've played 40k, BFG and Apocalypse for years. They are quitting too. And, unless you back down from this insane increase of your prices, others will follow.

Please consider what I have written. Because when I quite buying GW, I'll be selling my armies off and buying into Warmachine and possilby Flames of War. Not only will you lose my purchases, but you'll lose sales from the people who buy my armies- they won't need to buy anything from you as my armies are complete. Then, to add insult to injury, other companies will be getting my dollars and the dollars of my friends- which will further erode your market share.

Again, stop this price increase. Seriously.

Signed,

John Doe
Stackhouse
Hatchett
Chadwick
Big Josh
Fluffy_Loving_Teddy_Bear
Milquetoast (...List keeps growing, bitches!)
Unkle Jack*
Tom Tom*
Killahell*
Tiger Style*
LostinSpace*
Gobstopper*
Demeerz*
Gordon Aaron Gordon*
Psycho Mike*
Bourbontime*
Sixsystems

Um yeah. That "petition" is moronic, to say the least.

Email petitions rarely, if ever, work. Much less work with aliases rather than actual names.

So good luck with that, when in the same timeframe you could have printed out a form letter, then signed it yourself and distributed a dozen other letters to your friends--who distribute a dozen to their friends, etc.

Gaaah!! My fury knows no bounds! I must throw my models in the neighbors yard and take up a decent hobby like motorcross or Faberge egg smashing.
p.s. who am I kidding....like everyone else here I'd sell my kids for that sweet sweet gray plastic crack.

Good thing I bought a Monolith at half-price just yesterday.

I could see this being an issue for poorer gamers, but most of us just will throw the money away anyways.

Good thing I just bought 4 wave serpents...

Seriously, I think warhammer may be entering the realm of unaffordable for me. They are only raising the prices on a few items... but I need some of those items...

On the plus side, my stuff represents an excellent investment. At this rate in 1-2 years I'll be able to sell my stuff at 30% of retail prices and still make a profit over what I paid for it...

I'm going to post this once and then probably leave the thread, because I don't have the patience to try and convince people to actually read the data before they jump to conclusions. (Of course if someone is actually going to be reasonable about I'd be happy to debate it)

1) Last year GW had less than a 10% profit margin. They make 6 bucks off of every Land Raider they sell. This is not the mark of a 'greedy' company. (Maybe a grossly mismanaged one for not being able to handle costs better, though. Never attribute to malice that which can be explained by incompetence.) It's right here on page 2: http://investor.games-workshop.com/downloads/results/results2009/gw_year_end_09.pdf

2) Let's assume for a second that they were gouging us and getting like a 50% profit margin. That doesn't make them evil either, since they're a public company. They're just a cog in an evil engine. They HAVE to do whatever they can to increase profits as much as possible, at least to the point that shareholders won't call them out on it. A minority shareholder lawsuit would potentially cripple the company, leading to its IP gettting sold to someone else. Could be good, but it could also go to Hasbro. You really want that?

3) If you can afford to play and disagree with GW's practices and simply choose to no longer to support them, that's fine. I can respect that. But if you're going to quit because this price increase means you can no longer afford to play (I don't mean in a "not worth it" kind of way, I mean a literal "I can't afford to play this because I have to buy groceries instead" level of broke), then you shouldn't have been wasting money on plastic figures to begin with.

tl;dr version: GW is stupid and run by short-sighted asshats, but they aren't evil.

You are sort of misrepresenting the situation by saying they make $6 off a land raider. their gross margin is almost 72% so for a $60 land raider they are actually making about $43. unfortunately they are then spending the difference on who knows what. Same basic point, I guess, but it sort of throws some light on exactly how incompetently they are run. doesn't gross incompetence cross over into evil at some point?

Edit: Actually they make about half their income from selling to distributors (@ a 50% discount) so if you pay the full $60 at a GW store they are making about $47 off of you. It's late... someone better check my math, I think it might actually be more than that.

Poor chaplain on a bike.. No one bought him at 15$.. no one bought him at 20$.. no one bought him at 25$.. and sure as hell no one is going to buy him at 30$

There is probably a store room somewhere of nothing but chaplains on bikes and they've been sitting there so long the face on their pewter heads has turned into a frownie

Next time you give to a charity.. instead buy a chaplain on a bike.. Make him smile again

I fail to see how a 10% to 25% orice increase (for the exact same product) is a good thing no matter WHAT industry it is.

The sad part is that they will make MORE profit per item now, so even though they might not be selling as many items they will be making more money.

I'm probably too sleepy to get this right so bear with me... I think this is interesting. I think we can actually figure out a rough estimate of how much it costs them to produce a kit from this report. 59% of their sales they get to keep the full amount and 41% are to independant sellers @ a 50% discount. so 6 kits direct for every 8 kits to independant stockists. (6*60+8*30)/14=$42.86 (average sale price) on which they make a 72% margin($30.86 margin) so actual cost to them to make a $60 kit is $12. so GW gets $48 if you buy it from them and $18 if you buy it from an independant retailer (the retailer pockets the difference)

asmith wrote:You are sort of misrepresenting the situation by saying they make $6 off a land raider. their gross margin is almost 72% so for a $60 land raider they are actually making about $43. unfortunately they are then spending the difference on who knows what. Same basic point, I guess, but it sort of throws some light on exactly how incompetently they are run. doesn't gross incompetence cross over into evil at some point?

Edit: Actually they make about half their income from selling to distributors (@ a 50% discount) so if you pay the full $60 at a GW store they are making about $47 off of you. It's late... someone better check my math, I think it might actually be more than that.

Where are you getting the 72% figure from? I can't find it in the report.

Also, I'm not doubting that at all. Nobody can really argue they spend their revenue very well. In all likelihood they COULD charge 30 bucks for a land raider AND get a higher profit margin than what they do now, but god knows what they're spending all this money on.

yeah they didn't explicitly list it in this report

gross margin = (revenue-cost of sales)/revenue

edit: *100% of course

theyre spending it on REAL land raiders.. You think their fluff is fiction? its their MASTER PLAN

Soon we'll be under the boot of genetically engineered british people who only serve you tea and death (Not necessarily in that order)

My guess is they spend most of it on stores and employees who run the stores. I think this model is killing them (in the states at least). Not sure if this would come under the heading of cost of sales or not. I don't think so but I'm no accountant.

GW's problem is that they're a dinosaur. With their business models, they should be extinct. It took them long enough to accept that the internet was more than a fad (and even then, I'm willing to bet some of them still aren't convinced). Ostrakon brings up the low profit margin, but that could probably all be avoided if they were to rework their operations from the inside out. Of course, change and Games Workshop never went together very well.

asmith wrote:yeah they didn't explicitly list it in this report

gross margin = (revenue-cost of sales)/revenue

edit: *100% of course

Oh, I didn't see their cost of sales. It's in their summary on the last few pages.

Well, that means they spent roughly 80 million on things not directly related to generating profit. Payroll and rent are probably a huge chunk of that, considering their business model. Not to mention their IP lawyers, sadly.

80 million sounds like a lot, but I dunno how many facilities they have, how many GW storefronts they have, and how much it costs to maintain them. Not to mention how much they spent on payroll.

I guess it's conceivable that it should be a lot lower, but how much of that 45 bucks per land raider (and that's just direct sales) goes to paying employees physically keeping their storefronts open? Anyone have an idea what the rent is like in a reasonably populated mall or commercial district?


Automatically Appended Next Post:

asmith wrote:My guess is they spend most of it on stores and employees who run the stores. I think this model is killing them (in the states at least). Not sure if this would come under the heading of cost of sales or not. I don't think so but I'm no accountant.

Yeah, cost of sales really only refers to the direct costs of materials, making/designing the minis, and shipping them. Money spent advertising and selling them fall under operating expenses.

I find it dryly amusing that soon it will cost about as much to pick up a forge world Guard army as a 'regular' guard army.

Increases like this happen all the time. Sometimes there's a good reason, sometimes there isn't.

I have no problem with them increasing their price. After the second price increase I experienced I quit playing and moved onto different games. GW still makes fun games, but it wasn't for me.

I think it's been posted before that GW doesn't have a huge profit margin. But that's not any of our faults.

Simply look at other companies on the market, and the cost of their items that are of the same quality or better then GW's products, yet significantly cheaper. GW might say they are hurting for money, but this is more likely due to their poor business plan then production costs.

GW prices are always going to increase, I think nobody is under the illusion that steady price increases won't happen.

There are plenty of great games out there that provide great experiences for a cheaper price point. Check some out, you might dig them. If you choose to play GW games, expect steady increases in prices. We've seen them before, and we'll see them again. If you can look past that though, you've got a good game, with tons of support.

I'll still play the games just use different companies figures or older ones off e-bay...

Next project- Vampire Counts army using Mantic figures

Mick

What i find most interesting about this time's Price Increase , is the increase for codex and
AOBR , sort of the essentials that are supposed to draw us to the hobby.

It set the mentality to customers early on for warhammer is expensive , just look at the book , $30
The new customers dont even have the time to absorb in the oohs and the ahhhs for the cool fluff and cool looking armies to be further collected.

Its a deterrent that slaps the potential new customers wide wake to what they are getting into.

Great. An already expensive hobby just got even more expensive. I hope my FLGS does payment plans...

Better than what I had expected (for my armies at least). Maneaters only going up $2.50ish makes me happy. Seeing whirlwinds cost more than preads/vindies makes me wonder though. I was thinking about grabbing some for appoc formation, but now maybe not.

Seeing the Black Reach box go up to $90 is bafflingly high though. A 1/5th increase. I understand they're going to sell at most 1 per customer but still, it's an entry item designed to hook. Now it's a rather hefty investment.

I find the Beasts of War video analysis quite convincing (even if poor Darrell is not allowed to speak a single sentence without being interrupted ):
http://www.youtube.com/watch?v=UqwnwJQrHSk
There is absolutely no reason to raise the hurdle for beginners by raising the price for the starter box. This is just dumb. Didn't work in the past, will not work now.

yeah really thats the big move I dont get.. I think GW needs to have a talk with their local drug dealers

The first hit is always free because they'll come back for the 2nd.. 3rd..4th

Ah well.. Im sure some marketing executive crunched some numbers and found that it was time for lunch... so he made something up regarding "higher starter sets lead to more profit"..

Kirasu wrote:............Soon we'll be under the boot of genetically engineered british people who only serve you tea and death (Not necessarily in that order)

Spiffing! At last a GW that I can really get on board with! Now then colonials I demand that you make prayer and offering to your new God-Empress - Liz. Gawd bless her!

All we can do is see how the price rises will affect GW when they release their financial statements next year.

I don't think that there will be a dramatic negative impact.

New gamers are still coming into the GW hobby.
Collectors will still be buying.
Veterans will also still be tempted by new minis, must have units, and new rules.

I would think that any veteran who has 4 or more playable armies would be considered by GW to have 'spent up' anyway.

The fact is that whilst I may not be spending my disposable income on GW products my two kids are spending their pocket money/birthday money/christmas money at the local GW.