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agosto wrote:
Halo 3: released Sept 2007. $27
Gears of War 2: Released November 2008. $28
Ledt 4 Dead: released November 2008. $20
Bioshock: Released August 2007. $20
Dead Rising: Released August 2006. $17
Saying "Would you buy Island of Blood for $90, or 3 games that were released 2 to 4 years ago" isn't exactly the same argument, yes?

Computer games have a very unusual pricing model. Few items are steadily reduced in price as the design ages. It would be nice to buy a new car for 50-25% of it's original purchase prices because that model came out a few years ago....

asmith wrote:I keep posting it but it doesn't seem to sink in. On all the models GW makes they make a 72% margin on average. That means taking everything you said into account with the molds machinery and manpower to produce the goods, they are making a big margin by any standard. $12 to produce a $60 box on average. Almost any consumer good you find will be on a much smaller margin than that. For instance Walmart and most of its suppliers operates on less than 10%.

People don't complain because the plastic in the ring costs a penny. They complain because it actually cost a penny to make with all those factors you added in considered. Actually to put it better, for most other things people are used to buying, if a ring costs 10cents to purchase, it likely cost 9 cents to get it there all things considered, where GW would charge 50 cents for the same thing. Its that 5x multiplier for GW goods that in my opinion, keeps them from explosive growth. Hell knock it down to a 3x multiplier and they would more than make up the money both in short, and especially long term IMO.

I worked with a number of different consumer product companies, they'd come in and give us presentations about their goals. I'd say the average margin was 50%. The companies that could tend to throw money around tend to have margins above that. Like Dell had a 50% margin while Alienware was about 65%. The killer was Gillette with ridiculous mark ups 300% on its razor heads, as well as golf club companies which would sell a $10 golf club for $150+.

I'm not disagreeing with you, just think you might be over generalizing.

The thing is the price of materials that go into a GW model kit isn't much. Having designed injection molds, its probably $3-4 for a 10 man squad, maybe a little more when you add the bits, but allowing for higher end materials. I think part of the problem alot of people have is that by its nature of being a kit, it is inherently unrefined comes out of a machine and goes in a box. Its specialized but its not labor intensive. A standard two sprue, 10 man kit has only $4 (lets go high side) of material, add in $2 for packaging. Labor and other overhead, lets say doubles it since when I planned production thats was a good estimate, $12 My belief is that even before they sell it to retailers they've already marked it up beyond the margins you're talking about. If you purchase from a wholesaler GW's products are 45% off, so the wholesaler probably gets it at 50% off. Selling a "$12" kit that retails for $35 to the wholesaler/retailers for $17.50 - $22.50. So a $12 investment nets GW $5.50, $10.50, $23.00 depending on who is buying it, that is depleted by taxes, rent, debts, etc and whats left is profit. In GW's case for a revenue of $230M about $20M was profit, putting their company wide profit margin at 10%. Assuming an even distribution of other costs, depending on who they sell it to a kit makes them $1.75, $2.25, or $3.50 profit.

Halo 3: released Sept 2007. $27
Gears of War 2: Released November 2008. $28
Ledt 4 Dead: released November 2008. $20
Bioshock: Released August 2007. $20
Gears of War 1 - $5

Fix'd

I would go for the five games to be completely honest, even if they are older. Just because they are older doesn't mean they are not worth the price, especially when each one offers dozens of hours of single player and hundreds of multi player. I guess you could just go for the plastic models that are completely useless in any 8th edition game... we could just call it $300 to make a Sea Guard unit that would be remotely effective. In the end it is "such a fantastic deal" because GW jacked the prices up on the regular boxes, it is only the appearance of a good deal.

So rather than pissing and moaning about it here, calmly compose a letter stating your grievance and send it.

It's not that hard, but given some of the mannerisms and behaviors of people here I can understand why they'd just junk most of their mail.

Scott-S6 wrote:
Computer games have a very unusual pricing model. Few items are steadily reduced in price as the design ages. It would be nice to buy a new car for 50-25% of it's original purchase prices because that model came out a few years ago....

I guess cars in England don't depreciate as fast as they do here...
A $20,000 (USD) car that is just three years old is worth about $11,616. That's just a straight number and doesn't take into account factors like wear and tear...
http://www.carprice.com/depreciation-calculator

kanluwen wrote:
So rather than pissing and moaning about it here, calmly compose a letter stating your grievance and send it.

It's not that hard, but given some of the mannerisms and behaviors of people here I can understand why they'd just junk most of their mail.

What else is the internet for if not for "pissing and moaning"? If I can't do that then all I have left is porn and emptying my spam folder.

Yea price hikes are gakky but you arguably get much more for your dollar nowadays since the quality of the starter set models have improved greatly. Its also still cheaper than or around the same price as comic book shop board games and even GW's own Space Hulk.

As for attracting new players, I think this era of GW has been the best for that mainly due to GW Video Games (upcoming titles: Space Marine, 40k MMO, probably future DOW/Warhammer Online stuff, and there's even been smaller games like Blood Bowl), GW Movies - Okay so there's really only one in the works but if that Space Marine DVD proves to be successful I can see them rehiring that studio for future projects, and better and easier to assemble models (new Leman Russ is much easier to assemble for example, comes with various weapon upgrades that can be interchangeable, and the newer models are simply much more bad ass than they used to be - now everyone can get cool looking flyers like Valks and superheavies like the Banebldae instead of only dreaming of owning an expensive Thunderhawk or FW Baneblade/Titan...).

@ mythos: I just looked up dell it has been less than 20% margin since the 90's, so I'm not sure where your number comes from. It's funny you should mention razor blades, that 300% markup is less than the 400% markup that you get buying direct from GW! Alienware is a subsidiary of dell and Gillete is owned by P&G so those numbers aren't commonly available. I still say you'll struggle to find any companies that produce consumer goods that operate at these high margin levels. the medical device industry operates at these kind of levels because of the large risk involved, but not consumer goods.

On topic most razor blade companies sell or give away the more expensive handles at a loss so they can make their money on the high margin blades. GW is selling everything at the high margin without the hook.

I'm also an engineer that designs molds. I agree with the piece part numbers you gave if you were outsourcing everything, but GW does all their manufacturing in house, so the real numbers are going to be much lower than that. PS is like $3 a pound so raw material costs are likely less than a dollar. We don't have to speculate on their production costs because they give them in the statement. 72% margin average on all their products.


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@ scott-s6: I highly doubt that any particular version of DVD player sells hundreds of millions per year. Maybe all of the hundreds of models out there combine for hundreds of millions of year, but likely we are talking approximately the same number in regards to individual units. The reason DVD players are so much cheaper is because the people who make them operate at very low margins.

You guys forgot the 2 items marked up the most EVER. Foutain sodas and popcorn!

I just looked up proctor and gamble and what do you know also 20% margin.

@ Alvar : also the reason why a lot of people don't buy popcorn and soda at the movies (or even go to the movies) anymore.

Edit: just for fun if GW operated at a 20% margin level the $100 box would instead cost $25. ((N-20)/N = .2 for the math impaired).

I'm not saying GW can afford to operate at these kind of levels, but this kind of pricing is what people are used to paying for products which cost about the same to make.

U.S. DVD HARDWARE SALES (in millions: 1997-2006) 194.362 or 21.6 per year....in the most consumerist nation in the world.

http://www.dvdinformation.com/news/press/CES010807.htm

@ agnosto: Good find, now if we divide that by the hundreds if not thousands of models of DVD players made over that time frame each individual model is going to have a more reasonable number of sales per year (in the 10's to 100's of thousands per year range) not that far from what GW produces.


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For a scary comparison Walmart would sell the same $100 box that cost $20 to make for $21.27 (6% margin I just looked up) last year. No wonder they put everyone out of business.

Edit: ^this is your $25 DVD player.

Interesting conversation here. I had a bit of time and was reading the GW FY2010 earnings statement when I ran across this:

GW wrote:Reported sales increased by 0.6% to £126.5 million for the year. However, on a constant currency basis, sales were down by 3.1% from £125.7 million to £121.8 million; progress was achieved in Northern Europe (+0.5%) and North America (+0.4%), while sales in Continental Europe (-9.3%), Australia (-2.8%) and Emerging Markets and Japan (-3.5%) were in decline."

Being pegged to the GBP is painful. The GBP is too strong for a smallish international firm IMHO.

GW wrote:Before royalty income, core business operating profit rose by £7.5 million to £13.0 million. On a constant currency basis, core business operating profit increased by £6.2 million to £11.7 million. This constant currency growth was delivered by a 4.0% improvement in our gross margin and £4.3 million reduction in overheads.

How many price raises have we seen? No wonder their gross margin has gone up. So, operating costs are going down and margin (profit per unit) is rising.... Good for them, bad for our wallets.

I think that is what we have been seeing on a year over year basis since the start of the LOTR era. Constant or declining sales with constant price raising, meaning in real terms every year less and less people are buying. They think they are market saturated and are milking the diehards for all they are worth, when in reality I think they can expand their market dramatically if they priced reasonably.

I bought Team Fortress 2 a couple years ago for 20 bucks.
I have over 1000 hours of game time, Fractions of a cent for a game that is constantly updated by the developers.

Last night, i prepared a list for a blood angels army i wanted to start, 600 dollars all together, for something that i only get a few hours every week to play...

I am no economist, i know nothing about how to run a company, but as a consumer, i am looking at the value of the entertainment, why should i start that 600 dollar army when i can buy the next valve game next year? for probably 60 bucks.

You guys forgot the 2 items marked up the most EVER. Foutain sodas and popcorn!

Off topic but it did remind me of something. Look at the mark up GW puts on things that we can actually do good comparisons on. Lets compare shall we?

These may actually be the most marked up items EVER
Citadel tool kit $120...........Not sure probably $30 at Harbor Freight
Hobby knife $15................$1 at HF
Plastic cutters $15.............$2 at HF
hobby drill $15...................$2 at HF
Razor saw $22...................$2.99, for $7 i get one with a miter box, for $15 I get an 18 piece professional saw set
Crappy air brush $30...........$9.99 the cheapest they had, probably not as crappy as the GW one, 19.99 for the deluxe brush with control, still not a great brush, but leagues
. better than GW's (P.S. GW charges you more because you might use it as a multimelta, that would cut sales)
Super Glue $6.60................3 for $1
PVA glue $8.25..................Really? It's F@@@ing Elmer's glue! $1 anywhere on the face of the planet
Green stuff 20grams $10....$2.99 most anywhere else
Razor Wire $9.50...........$...$.50 Home depot
Work Station $40...............$10 Pat Catan's
Flock $8.25........................Old ladies buy this with their pension money at any craft store for pennies...$1

Is GW buying these things retail and then selling them? That may be why everything is so expensive....all that time melting other companies model kits for the plastic.

Next GW will be selling you dirt for $10 a pound

What amazes me is that they have the ball's to even sell these things at this markup. They are doing it with the minis too. Stop denying it. Stop making excuses for it. They are not luxury items, a baseball bat is not a luxury item. A gold plated baseball bat signed my Mickey Mantel is a luxury item. When the minis come pre painted to my specs and pre asseembled and move on their own, then i'll accept them as luxury items.

Until then they are model kits and should be priced as such.

People always complain about the prices and i understand it. Specially right now. But if you look at even kids toys now days they are expensive, some transformer piece of garbage can easily be $40 for some simple plastic toy. Also i have a ps3 as many of you probably do and i get WAY more use from my models then my ps3. Prices seem daunting when you are going from nothing to apocalypse sized games. If you are collecting for some years or so your army will grow without having to spend more then $100 or so at a time. Also i think about how much time i actually spend just painting my models. I feel the prices being higher almost makes you reflect on each squad as something you should spend the time to paint masterclass convert and truly look at that one squad for how nice it is, instead of thinking troops and such as fillers in your army. I have been repainting my army and doing every model with the same care and detail as i would do my hero's (yes its taking FOREVER) but fewer models really makes an impression when they are all nicely painted and detailed. I think complaints about prices are greatly related to impatience. I WANT A 5000 point army, and i WANT it now!

These may actually be the most marked up items EVER
Citadel tool kit $120...........Not sure probably $30 at Harbor Freight
Hobby knife $15................$1 at HF
Plastic cutters $15.............$2 at HF
hobby drill $15...................$2 at HF
Razor saw $22...................$2.99, for $7 i get one with a miter box, for $15 I get an 18 piece professional saw set
Crappy air brush $30...........$9.99 the cheapest they had, probably not as crappy as the GW one, 19.99 for the deluxe brush with control, still not a great brush, but leagues
. better than GW's (P.S. GW charges you more because you might use it as a multimelta, that would cut sales)
Super Glue $6.60................3 for $1
PVA glue $8.25..................Really? It's F@@@ing Elmer's glue! $1 anywhere on the face of the planet
Green stuff 20grams $10....$2.99 most anywhere else
Razor Wire $9.50...........$...$.50 Home depot
Work Station $40...............$10 Pat Catan's
Flock $8.25........................Old ladies buy this with their pension money at any craft store for pennies...$1

Seriously though does anyone buy supplies from Gameswork shop? Even the people who work in my games workshop tell me to go to other hobby stores and pick things up for fractions of the price. Then again i know them pretty well.

50 bucks for a used copy of Red Dead Redemption for the Xbox 360: Gaming time upwards of 150+ hours.

Hundreds of dollars (maybe thousands) in GW product sitting unused in my attic: Gaming time somewhere around 40 hours. Painting and modeling time somewhere around 200 hours.

On the plus side, I can re-sell some of my GW product.

People always complain about the prices and i understand it. Specially right now. But if you look at even kids toys now days they are expensive, some transformer piece of garbage can easily be $40 for some simple plastic toy

Lets have a look GI joe ultimate battle pack (target exclusive, so not a giant run)



2 Tanks (one of them motorized, Pew, Pew, Pew)
1 Flight pod
7 action figures, but for arguments sake 3 are vehicle drives so lets say 3+1 character model

Suggested price $62.99 according to list. I saw it in the stores for $55. I could buy it now new in box on ebay $50.

2 baneblades $99 a piece = $200 (I could have gone with 2 leman russ at $100, but these tanks are giant in comparison to even the baneblades, plus one is motorized)
Land Speeder= $30 (yeah could have used a jet bike $15, but the land speeder is closest in size)
3 marines= $8.25
cheapest character model I could find was marine Sargent 2 = $12.25 (yes he's metal, do you want me to use the $20 plastic marine commander)

$250.50! for unassembled, unpainted more detailed plastic sprue. It's not a perfect analogy but the difference tells the story!

And those are all just repainted variants of toys I had when i was a kid in 92.

The vehicles retailed for $15.99 each, with no figures in there.

What's your point?

Yeah baneblades are funny they're so expensive.
Wanna compare with another niche market? RC planes.
$90 will buy me a radio control airplane.....something that flies! Can your baneblade actually shoot stuff?

http://www.nitroplanes.com/gl401-3-j3-red-rtf.html

And those are all just repainted variants of toys I had when i was a kid in 92.

The vehicles retailed for $15.99 each, with no figures in there.

What's your point?

Interestingly enough they are not. They are all new molds/sculpts with additional details all redone for the 25th anniversary (yes including the vehicles, look it up if you doubt me). And hey that $17 Jain Zar .....I wonder when she was sculpted? oh yeah she cost about $5 then too. Or my favorite the $33 traitors of chaos box....well over 10 years old and probably $8 when it came out. (well it never came out that way before, but you get the drift..I hope)

Hasbro actually remade all the toys new sculpts/molds whatever. Many of the molds GW uses have been around for over 10 years.

Come correct or don't come at all! Booya!

Andrew1975 wrote:

And those are all just repainted variants of toys I had when i was a kid in 92.

The vehicles retailed for $15.99 each, with no figures in there.

What's your point?

Interestingly enough they are not. They are all new molds/sculpts with additional details (yes including the vehicles, look it up if you doubt me). And hey that $17. Jain Zar .....I wonder when she was sculpted? oh yeah she cost about $5 then too.

Hasbro actually remade all the toys new sculpts/molds whatever. Many of the molds GW uses have been around for over 10 years.

Come correct or don't come at all! Booya!

Bzzzzt, wrong.

They are not new. But hey, since you want to compare "detail"...

Take a peek inside of any one of those vehicles for the "detail" inside of them. Something like 75% of the detail will be decals over flat, unpainted surfaces molded from the exact same piece of plastic as the outer hull.

The only thing that Hasbro has remade is the 'new' molds. Games Workshop does this very same thing--in fact, that's part of what their projected costs for molds are.

How much it will cost them to replace said mold once it's worn down, will the mold be something that they need to run multiples of, will it be profitable to actually reuse the mold, etc.

Don't come back until you get some game, son.

Why are you two talking like streetballers?

andrew1975 wrote:Come correct or don't come at all! Booya!

kanluwen wrote:Don't come back until you get some game, son.

Bzzzzt, wrong.

They are not new. But hey, since you want to compare "detail"...

Take a peek inside of any one of those vehicles for the "detail" inside of them. Something like 75% of the detail will be decals over flat, unpainted surfaces molded from the exact same piece of plastic as the outer hull.

The only thing that Hasbro has remade is the 'new' molds. Games Workshop does this very same thing--in fact, that's part of what their projected costs for molds are.

How much it will cost them to replace said mold once it's worn down, will the mold be something that they need to run multiples of, will it be profitable to actually reuse the mold, etc.

Don't come back until you get some game, son.

Nope, evey action figure is brand new and the vehicle sculpts have either been completely remade or have had new details added. Go to YOJOE.com if you need the proof

Have you looked at the inside of a Leman Russ? Bane blade? Can you fit ten marines in a rhino? Do they even have crews. Decals...I have to paint 100% of the detail on every part of a mini? Seriously? Don't cherry pick. It take an utterly worthless conversation and makes it sound stupid.

IN THE FACE.

Why are you two talking like streetballers?

Its fun!

And the quarterback is toast!

Andrew1975 wrote:

Bzzzzt, wrong.

They are not new. But hey, since you want to compare "detail"...

Take a peek inside of any one of those vehicles for the "detail" inside of them. Something like 75% of the detail will be decals over flat, unpainted surfaces molded from the exact same piece of plastic as the outer hull.

The only thing that Hasbro has remade is the 'new' molds. Games Workshop does this very same thing--in fact, that's part of what their projected costs for molds are.

How much it will cost them to replace said mold once it's worn down, will the mold be something that they need to run multiples of, will it be profitable to actually reuse the mold, etc.

Don't come back until you get some game, son.

Nope, every action figure is brand new and the vehicle sculpts have either been completely remade or have had new details added. Go to YOJOE.com if you need the proof

And YoJoe.com is full of crap. My littlest brother has those 'brand new' vehicles and they're basically the exact same as the ones I had as a kid.

Have you looked at he inside of a Leman Russ? Bane blade?

Have you? The newer Leman Russ does have some minor interior detail, but it seems that you don't understand that you're comparing two wildly different things. People aren't going to see the inside of a completely finished Leman Russ or Baneblade. For that matter, most tank kits the size of a Baneblade that come with interior detail are pushing the $120 mark for one and basic interior detailing. It'll cost another $90 or so to get them up to "realistic" levels of detail.



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Andrew1975 wrote:Have you looked at the inside of a Leman Russ? Bane blade? Can you fit ten marines in a rhino? Do they even have crews. Decals...I have to paint 100% of the detail on every part of a mini? Seriously? Don't cherry pick. It makes an utterly worthless conversation and makes it sound stupid.

Says the genius comparing prepainted and poorly assembled action figures to models about half their size, but with far far far more details on them.

Man, I sure am glad you don't want an "utterly worthless conversation"....

Hope I'm not stating the obvious but details don't cost money when you are talking about cosmetic features. DVD's have many billions of features smashed into them, cost the same as if they were blank.

Size costs, assembly costs, complexity costs (how many different technologies/processes you are putting in), but part geometry in general does not cost.

shhhh asmith, don't be bringing logic into this.... we all know a mold is a mold regardless of the cosmetic features. Just smile and nod....smile and nod.

And YoJoe.com is full of crap. My littlest brother has those 'brand new' vehicles and they're basically the exact same as the ones I had as a kid.

People aren't going to see the inside of a completely finished Leman Russ or Baneblade. For that matter, most tank kits the size of a Baneblade that come with interior detail are pushing the $120 mark for one and basic interior detailing. It'll cost another $90 or so to get them up to "realistic" levels of detail.

Take a peek inside of any one of those vehicles for the "detail" inside of them. Something like 75% of the detail will be decals over flat, unpainted surfaces molded from the exact same piece of plastic as the outer hull.

Someone is angry because they were proven wrong. So what you are saying is the gi joe TOYS should have more detail than a MADEL KIT? They have all new details, its like comparing the new russ to the old russ. Same vehicle more details. There are no internal crew compartments on either of the Joe vehicles either. However both drivers do hold on to sticks and there are molded details in the hiss tank canopy.

This is a cost and production analysis. Again not perfect, but the glaring difference in price is well........glaring.

Off my court SUKA!

Depends on what you're talking about.

It's common knowledge in armor/aircraft modeling that you're probably going to have to pay out the rear to get a 'stock' kit up to museum quality in terms of details--or you're going to be investing alot of time into bringing them up to that level with scratchbuilt parts.


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Andrew1975 wrote:

And YoJoe.com is full of crap. My littlest brother has those 'brand new' vehicles and they're basically the exact same as the ones I had as a kid.

Someone is angry because they were proven wrong. They have all new details, its like comparing the new russ to the old russ. Same vehicle more details.

This is a cost and production analysis. Again not perfect, but the glaring difference in price is well........glaring.

Off my court SUKA!

You're doing a terrible job of any kind of real "cost and production analysis" then.

You're failing to remember the venues in which each item will be sold, the expected sales numbers, etc.

A "Target Exclusive GI-Joe" kit will be sold in more Target stores in one state alone than there are Games Workshop official shops worldwide.

It costs them nothing to sell for that price simply because of the sheer volume.

Kanluwen wrote:A "Target Exclusive GI-Joe" kit will be sold in more Target stores in one state alone than there are Games Workshop official shops worldwide.

It costs them nothing to sell for that price simply because of the sheer volume.

But that's the main argument, isn't it?

If GW lowered their prices, they will sell more?