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JohnHwangDD wrote:In 1993, we had usenet...

LOL, I guess you were way ahead of me in complaining over the internet then.

Old Guys Rule!

pombe wrote:I'm not complaining simply because I've seen this so many times before. And yet...GW remains a viable business.

I've learned that people simply don't put their money where their mouths are.

Here is what I tend to read whenever GW raises it's price:

May-June: $@#%$^%$%@ GW! I'm quitting! They are going to go out of business when we all quit!
May-July: Well, that just means I can go paint my backlog.
June-August: I'll only pick up the the necessities, like paint for my existing armies.
July-October: Well...I'll only pick up a few units for my existing armies...like that nifty new tank...or some Forgeworld stuff (because Forgeworld isn't really GW).
October-April: I have really cool ideas for a new army that I'd like to start!

rinse, repeat for over 10 years.

Sure, there are those who actually do quit...or at least stop their purchases for a while. But somehow, someway, this cycle perpetuates, which means many either don't quit like they said they would, don't stop their purchases as much as they say they would, and/or more people join the hobby. In any case, GW doesn't seem to have reached the critical threshold that would break this cycle, after so many years of doing this, including the Internet Sales Debacle. Sure...there's a global recession this year...but really...I doubt anything is going to break this cycle. People are going to keep spending.

I'll wait and see what people say when Planet Strike and Space Hulk come out later this year. Chances are...people will forget all about the price increase by then.

Thats pretty much how its going to go for most people, I think GW has them pegged for the crack heads they are. What they should be worrying about is the ones that slowly but surely get less and less, but then again GW really only cares about recruiting more people as the average little jimmy pulls in $1500 worth of product in their first year.
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pombe wrote:I'm not complaining simply because I've seen this so many times before. And yet...GW remains a viable business.

But does it? Their last 4 years accounts indicate an increasingly desperate financial position. Turnover seems to have levelled off its 4-year (8-year if you exlude the LotR bubble) decline for the published results for the 6 months to November 2008, which allowed the recent "cost savings" (redundancies) to yield a small return as opposed to the actual losses of the last couple of years. But lending has been increasing, and there are still no dividend payments for shareholders.

GW is not an attractive investment for anyone without the utmost faith in Kirby and his cronies.

I've learned that people simply don't put their money where their mouths are.

Here is what I tend to read whenever GW raises it's price:

May-June: $@#%$^%$%@ GW! I'm quitting! They are going to go out of business when we all quit!
May-July: Well, that just means I can go paint my backlog.
June-August: I'll only pick up the the necessities, like paint for my existing armies.
July-October: Well...I'll only pick up a few units for my existing armies...like that nifty new tank...or some Forgeworld stuff (because Forgeworld isn't really GW).
October-April: I have really cool ideas for a new army that I'd like to start!

rinse, repeat for over 10 years.

Sure, there are those who actually do quit...or at least stop their purchases for a while. But somehow, someway, this cycle perpetuates, which means many either don't quit like they said they would, don't stop their purchases as much as they say they would, and/or more people join the hobby.

Well, the reported figures indicate that in real terms, turnover has fallen (i.e. it has increases slower than the rate of UK inflation) back to the level it was at in 2001. That to me indicates they are selling only the same amount of product in volume terms that they were selling in 2001. They sold extra product while the LotR boom was on ('02-'04) but lotr-bubble aside the company has seen retraction in its market place in the last few years. So that would argue people actually ARE quitting the hobby - either the same people are buying less, or fewer people are buying. Certainly that is what the evidence suggests.

In any case, GW doesn't seem to have reached the critical threshold that would break this cycle, after so many years of doing this, including the Internet Sales Debacle. Sure...there's a global recession this year...but really...I doubt anything is going to break this cycle. People are going to keep spending.

The accounts indicate they are close. Very close.

I can't see planet strike will save them. Apoc slowed the decline down some but didn't halt it. Can't see Planet Strike making as big an impact as Apoc. WotR may make a temporary blip as it replaces lost sales of WFB and LotRSBG of recent years, but ultimately higher-than-inflationary price rises are biting into their market share tremendously.

That's what the accounts tell me anyhow.

Nothing anecdotal at all in any of my suppositions, all demonstrable from the figures GW have placed in the public domain.

Nothing anecdotal at all in any of my suppositions, all demonstrable from the figures GW have placed in the public domain.

And you've never been known to engage in pessimistic axgrinding or doomsaying. Never.

And not saying you're wrong, just too busy keeping stores afloat in this economy to really worry about GW's health. If they die off, I probably go bankrupt and closeup, ending 21 years of building up two gaming/comic shops. It depresses me to think about, so I don't go over GW finances with a fine tooth comb looking for ways they fail.)

Looking forward to getting a look at the pricing info when it comes out next week, just to end the discussion.

Just to note, GW finally put up the price for the plastic elf warriors they're releasing in June (the foot soldier/archers Galadrhim?---not the cavalry, which already had prices). Looks like that new box is selling for $33 also.

Wonder if all the GW foot soldier plastic boxes are going up to that price?

I'm thinking the plastic LOTR boxes may increase, but not up to the cost of the Galadrim. The Galadrim have to cover the production cost they incur, the other models covered that cost years ago, during the LOTR boom.

Or, they might all go up to the same price, based on alternative logics. Monday can't get here quick enough. I'm very curious.

mikhaila wrote:Nothing anecdotal at all in any of my suppositions, all demonstrable from the figures GW have placed in the public domain.

And you've never been known to engage in pessimistic axgrinding or doomsaying. Never.

And not saying you're wrong, just too busy keeping stores afloat in this economy to really worry about GW's health. If they die off, I probably go bankrupt and closeup, ending 21 years of building up two gaming/comic shops. It depresses me to think about, so I don't go over GW finances with a fine tooth comb looking for ways they fail.)

Looking forward to getting a look at the pricing info when it comes out next week, just to end the discussion.

You know, I have to say mikhaila makes good points here. I cant tell you how many times I have heard a store or gamer or website or SOME source doomcry GW.

They're going out of business. It's the last gasp. I'm selling out all my stock because this time next year they'll be toast.

Jesus wept. You know, from what I understand they are just getting to a stage where they are really going ot be profitable from the little I have heard about their actual business and infrastructure. They invested what HAD to be shedloads of cash in plastics. They should be spinning out money now that that investment phase is, from what I understand, over.

Maybe they're flyin. Maybe they're dyin. But for now they seem to be staying afloat.

mikhaila wrote:... Monday can't get here quick enough. I'm very curious.

? I thought the new prices went into effect in June not 18 May. Or is Monday significant for another reason?

privateer4hire wrote:

mikhaila wrote:... Monday can't get here quick enough. I'm very curious.

? I thought the new prices went into effect in June not 18 May. Or is Monday significant for another reason?

Yes, because it's probably when they release the new pricing info to some retailers/distributors. They go into effect on June 1st, but they have to tell us about them sooner.
(Well, except for that one time when they told us on Jan 3, about a Jan 1st increase. )

You will keep buying, you will buy higher prices, you will because you're all ADDICTED!!!!

I'm pretty sure the local addicts don't complain when the pusher raises the cost of his drug. I just end up having to replace my T.V. and Wii. . . .

lol at this thread. (im quitting! bawl.. This happens EVERY time.)

I do wonder though what the markup is on GW stuff. Must be massive.

grizgrin wrote:Maybe they're flyin. Maybe they're dyin. But for now they seem to be staying afloat.

But even dead bodies float...

Their continued trading does not negate the evidence of their financial peril to anyone with eyes to read.

I hope they do pull it off, even if that means quadrupling prices. But I somehow doubt that it is possible on their current trajectory:



Ask yourself this: as a retailer in the current economic climate, what is the riskier activity? Increasing your prices or decreasing them? Just because GW management allegedly know their own business, doesn't mean they understand it. After all there have been many in recent days who misunderstood the attitude of the general public towards them... many of them are in the UK House of Commons!

karnaeya wrote:lol at this thread. (im quitting! bawl.. This happens EVERY time.)

I do wonder though what the markup is on GW stuff. Must be massive.

From their 2008 accounts:

Revenue £110M
Cost of sales £34M
Gross profit £77M

Mark-up = 323%
Gross margin = 70%

Of course they piss it all away on operating costs and interest, which indicates volume sales are the problem, not unit prices...

But what the heck would I know about running corporate finances...? I've only been a (bored) Chartered Accountant for 16 years...

Uriels_Flame wrote:You will keep buying, you will buy higher prices, you will because you're all ADDICTED!!!!

That's how it's always been for me in the past, but this time, I think it's going to stick. I hope it does, so maybe I could stop hating myself.

well if GW increase prices by a large amount waylandgames.co.uk will have my custom until GW sort themselves out!!!! ITS A JOKE!!!

I'm not going to lie, but because of this I realized that I wasn't addicted to Warhammer 40k.

But dang...this sucks. Looks like I'm buying even less than before, which trust me, wasn't much as I have my hands full with my Wargames Factory models that I'm converting into Praetorians.

@ Osbad or anyone else who is financially astute:

So, what does this mean if GW's financial situation keeps worsening?

Specifically, what does this mean for us players?

GW is not going to go out of business...at least not overnight. What are the signs that we should look out for if the ship keeps sinking? Also, how might this benefit players? Especially if (and a big if) GW goes private again, and is no longer publicly traded?

I'm not worried about the universe or the IP. That is simply "too big to fail"...someone would pick it up if GW bought the farm.

Osbad wrote:Ask yourself this: as a retailer in the current economic climate, what is the riskier activity? Increasing your prices or decreasing them?

From their 2008 accounts:
Revenue £110M
Gross profit £77M

Of course they piss it all away on operating costs and interest, which indicates volume sales are the problem, not unit prices...

Given that most other retailers are decreasing their prices, or holding steady, I think the answer is pretty clear.

70% GP is pretty good. You'd think they could make a real profit with that, if they were managed well...

Again, if GW were well-managed...

You know i'm new to 40k, and all this "GW is dying" talk is really horrifying, but here's a thought.

2008 - big price increase

2009 - slightly smaller price increase

2010 - ???

2011 -

Do they continue to raise prices until they go out of business? or are they just trying to find the perfect spot between "nobody buys our stuff" and "95% of our retail prices are pure profit"

pombe wrote:@ Osbad or anyone else who is financially astute:

So, what does this mean if GW's financial situation keeps worsening?

Specifically, what does this mean for us players?

GW is not going to go out of business...at least not overnight. What are the signs that we should look out for if the ship keeps sinking? Also, how might this benefit players? Especially if (and a big if) GW goes private again, and is no longer publicly traded?

I'm not worried about the universe or the IP. That is simply "too big to fail"...someone would pick it up if GW bought the farm.

My guess is that if GW "failed" at some point, then the first casualty would surely be their store chain, plus any stuff that is currently "in development". A GW that was in difficulties would be looking to gain quick wins, so axing any expenditure that wouldn't produce IMMEDIATE returns would be the likely choice.

Depends how badly and how far they fell really. To some extent we have already seen the results of the gradual reduction in their business since 2004. To that extent the "ship has been sinking" since then.

The results have been - price rises (natch!), more focus on "profitable" lines - such as "big tanks", "space marines", "humans in general" and less scope for the "fun but obscure" elements of their business - such as Dark Eldar (*ahem*), SG, Bitz.

Anything that doesn't have a cast iron business case IN THE SHORT TERM, goes when a business struggles like GW has over the past 4-5 years.

So far this has all been "trimming the fat" - removing everything that is not absolutely optimal to their business. Including, controversially, many things that have cost them the goodwill of longstanding customers. Arguably for instance the "bitz" service paid dividends not in that it made much profit, but that it kept "vets" involved, who kept up the "good word of mouth advertising" that GW's growth is so dependent on. But that was unquantifiable and hard to calculate against the obvious costs of the service, so it got axed in favour of more easily demonstrable and short-term investments - such as the Baneblade and Valkyrie type large kits.

If GW continues to see stay-still or declining turnover, expect more of the same, I guess. Until their bankers and shareholders lose patience. Then everything's up for grabs.

An Eldar Darkly wrote:
Do they continue to raise prices until they go out of business? or are they just trying to find the perfect spot between "nobody buys our stuff" and "95% of our retail prices are pure profit"

They'll keep raising the price till they get a clear sign that enough is enough, then they'll lower the price back down alittle.
Normally this is risky if a competent rival company is able to jump in a perfect timming and swoop the customers away.

But , i must quote who ever that started this meme "I think GW is a pretty cool guy. eh kills GW customers and doesn't afraid of anything."

pombe wrote:I'm not complaining simply because I've seen this so many times before. And yet...GW remains a viable business.

I've learned that people simply don't put their money where their mouths are.

Here is what I tend to read whenever GW raises it's price:

May-June: $@#%$^%$%@ GW! I'm quitting! They are going to go out of business when we all quit!
May-July: Well, that just means I can go paint my backlog.
June-August: I'll only pick up the the necessities, like paint for my existing armies.
July-October: Well...I'll only pick up a few units for my existing armies...like that nifty new tank...or some Forgeworld stuff (because Forgeworld isn't really GW).
October-April: I have really cool ideas for a new army that I'd like to start!

rinse, repeat for over 10 years.

Sure, there are those who actually do quit...or at least stop their purchases for a while. But somehow, someway, this cycle perpetuates, which means many either don't quit like they said they would, don't stop their purchases as much as they say they would, and/or more people join the hobby. In any case, GW doesn't seem to have reached the critical threshold that would break this cycle, after so many years of doing this, including the Internet Sales Debacle. Sure...there's a global recession this year...but really...I doubt anything is going to break this cycle. People are going to keep spending.

I'll wait and see what people say when Planet Strike and Space Hulk come out later this year. Chances are...people will forget all about the price increase by then.

Or perhaps, some of us have alot of models and no need to get more. Or we troll ebay or bartertown for trade deals and such.

Just ebcause we "quit" GW doesnt mean we throw out our models and stop playing. But dont expect any real purchases anytime soon.

carmachu wrote:
Or perhaps, some of us have alot of models and no need to get more. Or we troll ebay or bartertown for trade deals and such.

Just ebcause we "quit" GW doesnt mean we throw out our models and stop playing. But dont expect any real purchases anytime soon.

Sure, a lot of us veterans turn to the secondary market to find good deals from those who are quitting or looking to trade.

But GW has figured out a way around this.

Every new Codex comes with brand new units that didn't exist before! Whether it's the Tau Vespids, the Tyranid Broodlord, the Chaos Demon Soul Grinders, the Space Marine Thunder Fire Cannon or Land Raider Redeemer variant, or the new slew of Imperial Guard Leman Russ varieties, GW makes sure that there is something brand new which isn't out in the secondary market, to entice veterans to spend money on their existing armies. Sure, some of these units have lousy rules, but the fact is, they are there and they didn't have to be. And vets have to buy these, at least initially, from retailers or online discounters.

This may not get the vets to buy whole new armies, but it certainly keeps the vets from severing the umbilical cord completely, so to speak.

To be honest this may be the "excuse" I need to cold-stop GW games.

I already feel the pinch from the "Hobby" side that I don't really enjoy where I constantly wonder: "Why do I have to do all this WORK (assembly/painting) to get to all the FUN (playing)".

If I didn't like the friends I made from playing the games, or didn't have as much fun at tournaments as I do (because of the people), I'd probably be selling all my crap as it is.

Right now it looks like "finish painting/assembling my crap and then stop whole hog".

Osbad wrote:

Anything that doesn't have a cast iron business case IN THE SHORT TERM, goes when a business struggles like GW has over the past 4-5 years.

So far this has all been "trimming the fat" - removing everything that is not absolutely optimal to their business. Including, controversially, many things that have cost them the goodwill of longstanding customers. Arguably for instance the "bitz" service paid dividends not in that it made much profit, but that it kept "vets" involved, who kept up the "good word of mouth advertising" that GW's growth is so dependent on. But that was unquantifiable and hard to calculate against the obvious costs of the service, so it got axed in favour of more easily demonstrable and short-term investments - such as the Baneblade and Valkyrie type large kits.

If GW continues to see stay-still or declining turnover, expect more of the same, I guess. Until their bankers and shareholders lose patience. Then everything's up for grabs.

So what that means is that GW is going to focus on large one-off purchases, like the Baneblade, the Shadowsword, the Valkyrie, the Stompa, and the Thunderhawk, that were previously unavailable except through Forgeworld, while toning down the development of fringe armies like the various Ordos and Dark Eldar that already have miniatures out in the player pool? That seems to indicate that they are, like I suggested in my post above, that GW is focusing on units that are not available on the secondary market, to bring in quick revenue since players cannot buy these from other players.

EDIT: LOL...the Blood Ravens Codex rumor...I'm keeling over in cynical laughter right now. How many Space Marines Codecies do we need? Well, I hope GW's gamble pays off and they convert the DoW players to the tabletop version. ROFLMAO....

So GW felt the need to hose the US even more on some of the most expensive items. With the current exchange rates I won't be purchasing any of the big/expensive stuff from the US anymore.


Long live the cheap UK online discounters. Because in most cases even with shipping I will be able to get things like Landraiders and Terminators cheaper than buying locally.

Osbad wrote:Anything that doesn't have a cast iron business case IN THE SHORT TERM, goes when a business struggles like GW has over the past 4-5 years.

So far this has all been "trimming the fat" - removing everything that is not absolutely optimal to their business.

If GW doesn't stay in business in the short term, the long term doesn't matter. Look at the car guys. Even Honda & Toyota are bleeding, so they're busy "trimming the fat" so they don't end up like GM & Chrysler.
____

pombe wrote:So what that means is that GW is going to focus on large one-off purchases, like the Baneblade, the Shadowsword, the Valkyrie, the Stompa, and the Thunderhawk, that were previously unavailable except through Forgeworld, while toning down the development of fringe armies like the various Ordos and Dark Eldar that already have miniatures out in the player pool?

In business there is a strong case for "firing" your worst customers, those customers who cost you more than they're worth. This is a hard-nosed application of the 90/10 or 80/20 rule in which 80-90% of your problems are caused by just 10-20% of your customers, while 80-90% of your profits are caused by just 10-20% of your accounts. If you simply walk away from the 10% of your worst customers, everything becomes a lot better.

So far, GW has only done this with the Squats, with the Chaos Dwarves and DoW (me!) sitting on the sidelines, and the DE literally waiting in the limbo of the Warp.

IMO, there is a lot of unnecessary selfishness going on here, with people demanding GW spend efforts on what are almost certain to be unprofitable projects in a time which everything needs to make money. This isn't a sprint, people, it's a marathon. If you can ride out these lean years, eventually, GW will get to you. But GW needs to be in business to do so.

Hammerziet wrote:Oh another benefit with less people buying and fewer new players the stores will be less crowded with little children.

Therein lies the problem. The only kids at the stores will be the spoiled brats who's parents buy whatever for them.