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WarOne wrote:

Kilkrazy wrote:Given the tie-in with Fantasy Flight Games, you would think it would be easy to carry a range of related board games.

Too bad they don't have a division like Hasbro has with Avalon Hill that could make the board games for them...

You don't exactly need a genius to do a boardgame. Any decent game designer should be able to do the basics in two lunch breaks. Both PP and Mantic have board games, for Christ's sake. Considering the crap GW players put up with, they don't even have to do any balancing whatsoever.
Then again, their current designers might be simply unable to comprehend rules that aren't written in the "And then this and this and this and you think yourself up how it works!" style, since a board game needs a basic level of coherency and tightness, and not 400 pages of special rules and amendments. And of course 6 to 8 erratas.

This report shows how consistently badly GW was doing in the past years. January will be much more interesting, since GW took it up to a whole new level of idiocy in the meantime.

reds8n wrote:

From a strategic perspective, Citadel Finecast has established an
even greater quality differential for Games Workshop over other miniature makers using traditional
metal manufacturing methods. Importantly, it will be difficult technically, with a high entry cost, for
anyone to try to establish manufacturing facilities to replicate product of this quality in significant
volume.

Interesting... so they define "high entry cost" as a couple of Polish guys working in their basement/garage on their spare time then? Because lots of little companies have *EXCEEDED* GW's recent quality of casting with Finecast. The sculpting may not be the same quality but the actual production QA is a hell of alot better.

Lokos good to me, I get another dividend payment. Woot. That's two payments in one calendar year, no complaints from me when a company I own stock in gives me money back and increases in share price.


Yeah, the sky's not falling quite yet. Doomsaying internet hyperbole aside.

I expected profitability and more loss to the customer base as compared to the previous financial reports.

Not this.

The GW Apolgists will of course try to sugar coat the results into a more favorable manner.

SilverMK2 wrote:Talking about fincast: "The initial production run achieved a
97% quality level, far exceeding previous levels achieved in the development phase"

Where did they pull 97% from?

Because, believe it or not, there are many a number of people (myself included) who purchased Finecast miniatures and had no problem with them.

Unfortunately, when people are satisfied, it's a lot harder to find the energy to make a forum post detailing their experience than it is when you're motivated by rage.

So yeah, the loud angry anti-GW types'll always constitute a seeming 'majority' online... *cough* H.B.M.C. *cough8

Vetric wrote:I'm amazed at the Facebook idea. Many big retailers have developed "new media" policies for their staff that very clearly spell out saying anything negative, even on a personal webpage/blog/whatever, can get an employee in hot water. All those tweets, status updates and things are being centralized at head offices. Suddenly having 392 "official" pages is almost a guarantee for comedy gold, and a huge headache for store staff.

All it will take is one off-hand or distempered comment on the Facebookz to get the intrawebz rattled.

Kilkrazy wrote:I've been saying for years that GW made a mistake by cutting back to the three core games.

In my view, they should leverage the very large amount of money they spend on retail locations by putting more things in shops for people to buy.

Given the tie-in with Fantasy Flight Games, you would think it would be easy to carry a range of related board games.

Very good point. What they are clearly lacking at the moment is "gateway game". Something akin to Space Crusade/Space Hulk to hook up new people to GW universe.

Backfire wrote:

Kilkrazy wrote:I've been saying for years that GW made a mistake by cutting back to the three core games.

In my view, they should leverage the very large amount of money they spend on retail locations by putting more things in shops for people to buy.

Given the tie-in with Fantasy Flight Games, you would think it would be easy to carry a range of related board games.

Very good point. What they are clearly lacking at the moment is "gateway game". Something akin to Space Crusade/Space Hulk to hook up new people to GW universe.

You both bring up a very good point; though I can't imagine they would have dropped those games if they were profitable. That said, it doesn't mean something insane like that didn't happen, I just don't know.

agnosto wrote:

Backfire wrote:

Kilkrazy wrote:I've been saying for years that GW made a mistake by cutting back to the three core games.

In my view, they should leverage the very large amount of money they spend on retail locations by putting more things in shops for people to buy.

Given the tie-in with Fantasy Flight Games, you would think it would be easy to carry a range of related board games.

Very good point. What they are clearly lacking at the moment is "gateway game". Something akin to Space Crusade/Space Hulk to hook up new people to GW universe.

You both bring up a very good point; though I can't imagine they would have dropped those games if they were profitable. That said, it doesn't mean something insane like that didn't happen, I just don't know.

Lots of retail chains use loss leaders to bring in custom.

You're right, it's like the PS3 and Xbox; both companies lose money on the core system so they can make it in other areas.

agnosto wrote:You're right, it's like the PS3 and Xbox; both companies lose money on the core system so they can make it in other areas.

You only need to look as far as Nintendo to discover that it doesn't necessarily have to be this way.

obsidianaura wrote:There's also the hobbit coming out eventually and that may have a positive effect.

Everyone, including GW, seem to be taking this as money in the bank. I'm not so convinced. I'm going to put my marker down and say "The Hobbit" will probably be profitable, but not very much so, and only a fraction of the profit they got from 2002-2004. My reasoning is because:

1/ There is no BGiME this time around
2/ I don't think The Hobbit will generate the fan-merchandising-fever that LotR did first time around.

I think it's been said before but the current loss leaders should be the starter sets.....sort of a gateway drug. Wasn't there a rumor going around that 6th edition 40k would have more than one starter?

The starter sets are loss leaders, but they don't seem to be working.

The info we find in the figures is that GW unit sales are declining year on year.

Things need to show a big turnaround in December, and more importantly next July.

@agnosto: I think that setting the current starters as Loss Leaders would be a terrible choice. You would sell starters, but not necessarily sell additional product. The problem with GW IMHO, is that their core products have the perception of offering extremely poor value. When you buy into the system, all you know for sure is that you're buying some very nice, and very expensive models. Any value added services have been downloaded to the retail outlets / independent retailers - meaning that GW retains almost NO CONTROL of value added customer experience - and the part that they DO control - the ruleset - is hamfistedly put together.

Going by the video game model, without good game support, the console is going to fail regardless of how cheap it is. Unless GW fixes their "software", selling the starters at a loss is only going to exacerbate their financial woes.

I have been thinking about this too and I'd have to concure with that, people need another way in to the GW hobby that isn't the starter set.
Something easy for the masses that is light and self contained.
It would also be helpful if these were on the store shelves of places that arn't GW like toys are us or similar stores right next to your hasbros and such.

I'd say space hulk but thats really been done, in this case it wouldn't have been wise to have done that limited edition and done a longer run through such other retail outlets.

The sad thing is that there is nothing about GW that's not fixable, you just know they won't do it...

Oh well, at least we have <insert name of your favourite company here> and the rest of GW's competitors to fall back on for our gaming needs.

Yes, GW there are other companies out there. Realise it, grow up, adjust, compete. You know, do the things that real companies do in the marketplace and maybe, just maybe, you'll stay with us...

Backfire wrote:What they are clearly lacking at the moment is "gateway game".

Given their current state of mind, the next 40k starter box is a limited release sold out the first week

Kilkrazy wrote:The starter sets are loss leaders, but they don't seem to be working.

Are you sure that your definition of loss leader is correct, given the price of 78 € for the starter box?

Wikipedia wrote:A loss leader or leader is a product sold at a low price (at cost or below cost) to stimulate other profitable sales.

The starter sets are loss leaders, but they don't seem to be working.

The starter sets are balls - the minis are great, but from a starting POV they don't contain fully legal forces (HE & SM) nor do they come with any scenery of anykind, nor do they come with small campaign or scenario booklets which help teach people easily, step by step. The mini rulebooks are great but they need to produce mini fluff books as well - as a kid I had no end of fluff to read in all the different boxed games I got and that kept me interested for nigh on two decades.

I agree with KK, the more I think about it the more Specialist Games and FF games need to make an appearance in store - I don't know the deal GW has with Fantasy Flight, but if independents get their books and games in I see no reason why GW can't. GW stores are stale environments - I dislike going in there to buy anything, especially when I know I can get the product for 15-25% less. I'm amazed how they seem to bury their heads in the sands - what's the betting 40k gets 6th Edition next summer, just to keep the numbers up for another year until the Hobbit arrives? I hope they see sense and start doing Codex ebooks.

A drop of sales in the U.K, U.S and Aus (by quite a percentage) cannot be good news for GW - I'd imagaine Aus sales in particular will show a continuing decrease in sales. January's report shall be interesting reading. GW needs to do things like have the occassional sale - remember when a new hobby store opened and they had 15% discounts and offered bundle deals? The U.K high street is struggling in general. I think if they had a Summer Intro deal and Christmas/Easter Deals that will help target the kids in the holidays - if they ran a competion in White Dwarf each month and in general did things to make the hobby 'fun' again, this would also be better. They need to realise that they are a retail business like anyone else - get more variety of product and do things to make customers keep coming back to their stores - opening Facebook pages just doesn't cut it. They may be 'niche' - but they're acting like they are omnipotent in the face of decreasing sales, successful competitors and a continuing global recession

This said all they need to do is make models of all the Primarchs and release a 5 man box of plastic Heresy-style Marines - That should give 'em a good bonus for a while - but they won't. They could have made a Limited Edition "Finecast" Horus or Sanguinius (etc) to mark Finecast's release (if it was THAT special) - how much would that have made in both money's and kudos? (bar all the returns of course ) Idiots :facepalm

Anyway - Thanks to all the economic-headed guys for their posts, I appreciate the input

You know how Kirby mentioned age a lot? Could it be that the heads at GW are simply too old and out of touch to make GW the ultimate miniature gaming behemoth it should be (not that in fantasy gaming terms it's small, but that cracks have appeared over the last 5 years or so)?

I'm also angry about some of the recent decissions taken by GW but, in a more generic way, I expect they recover their common sense (and with it, their profits), because I like their games, and I don't see myself changing to another company.

This report is very interesting, as they can see some negative effects, and they have time to fix those errors.

Thanks for all these explanations.

Meh, pretty much what I expected. The figures we can never see are the number of online whiners/haters verses the number of customers that just buy a few toys every other month. I think all the finecast / regional embargo / price rises will show more next year. How they can still say finecast is fantastic is beyond me. I like the medium and it has it's quality issues but it's 98% old models, there's nothing exciting about that at all. As for the new manager training thing I think that reads various ways;

The imagery and tone of GWs product is grimdark so don't try to make it PC

The fans of GW are a niche group who are willing to pay for their product so don't try to appeal outside this niche as it's wasted effort

Don't mess with the IP too much - no alternate realities etc and be willing to lose well known developers in order to protect it

People who 'fit' in GW. That's standard management talk, it means don't hire people who will try to change the company and possibly screw up our IP money machine

Ultimately all GW want to do is maintain the status quo with existing customers, bring out a few exiting products (cue Jes Goodwin) and then try hard to get a little more growth in a market where many people have tried GW product then left and may return as well as new kids coming fresh into the hobby.

The one thing I don't get from the rumours is that everyone is talking about 40k for next year and yet the Hobbit comes out then. Surely there will be a boxed set for The Hobbit as they did with The Lord of The Rings? I 'm not sure they can launch two boxed games in one year in the current economy.

Chimera_Calvin wrote:The sad thing is that there is nothing about GW that's not fixable, you just know they won't do it...

Oh well, at least we have <insert name of your favourite company here> and the rest of GW's competitors to fall back on for our gaming needs.

Yes, GW there are other companies out there. Realise it, grow up, adjust, compete. You know, do the things that real companies do in the marketplace and maybe, just maybe, you'll stay with us...

I agree with you overall, but I have to laugh a lot when everyone starts talking about 'real companies' and talk about the other gaming companies.)

They all have problems. They all behave in unbusinesslike ways. They all have people leading them down directions that need later correction. You only have to look at the trail of bankrupt game manufacturers to see some of the casulties where their actions/designs weren't fixable. As a consumer, you guys see the product, (sometimes lack of product), on a stores shelves. As a retailer, I deal with a lot more of the stuff you guys don't see. Talking with distributors and people working in the companies, there's huge amounts I'll never get the full story on, but is frightening with just a glimpse.

It all looks easy from the internet, and very black and white. You see more of the underside of GW because they are public.

I'm not buying the "PC need not apply" line...

I was one of the freelance writers for FFG on the Rogue Trader book, and I had an intro to the psionics section that had a bit about the perils of the warp that we jokingly referred to as the "I've come for your daughter Chuck" quote. But GW nixed it* as part of the family friendly face they wanted for their gaming.

Grimdark was fine, but don't take someone's kid!

We all thought it was a bit odd, but it went to the cutting room floor, then we shrugged and banged out something else.

*: I'll also be the first to admit that there is every possibility that my editor at FFG nixed it, but I've known him for a while, and when he didn't like something I wrote, he was pretty blunt with me.

I think the key thing to take away from their investor report gobbeldygook is the following:

Decreases in sales revenue seems to follow the trend of -3% +/- 1% per annum over the last five years. Cumulatively, this represents a 15.8% (as the decreases are compounded) decrease in sales revenue. The telling point is that prices have gone up during that period. Using a conservative 30% increase across the board over 5 years - (assuming an even distribution across the board - unlikely, I know) would suggest that for product moved - volumes actually dropped in the neighbourhood of 34% over that same period.

Now, as we know that standard game sizes also skew towards needing more models - based on already declining sales volume, this would suggest that yet fewer players are participating in building standard sized armies.

While a decrease in revenue of 15% is worrying - it has largely been managed by "efficiencies" as evidenced by GW's reports. The hidden drop in volume is down right frightening.

...sales in ... Australia (-11.8%) were in decline.

Do these numbers take into account wholesale business? I presume so.

That being the case, I believe we have the reasoning for their new sales restrictions. A UK seller shipping to AU counts as UK sales, while an AU seller shipping within AU counts as AU sales. They want their AU numbers up so, rather than making any intelligent business decisions, they try to force Aussies to pick up the slack with attempted enforcement of ridiculous restrictions.

Eric

And the funny thing is that sales in the UK are down as well...Just not as much.

skyth wrote:And the funny thing is that sales in the UK are down as well...Just not as much.

That should terrify them. At least you'd think so, but apparently not.

Maybe they know something we don't, like miscast Finecast is the cure for cancer, and once they reveal that AND get the Hobbit rolling, they'll be swimming in money.

Kilkrazy wrote:They are making a profit.
Why close 70% of Japanese shops after the business grew there?

Did any of their stores close based on the turbulence in the country? Did any of them flood or wash away? If so that could be one of the reasons why they closed the shops. We had that issue in Florida when we had 5 Hurricanes and 2 Tropical storms dump 4 feet of water over Central Florida in 2 months back in 2004. Many businesses took their insurance payout and never re-opened. That is an alternative rebuilding and reopening several months later. I can imagine that since there is a lot of upheavel in the country closing the shops in the short term and waiting for the country to stabilize would be beneficial.

This actually surprised me. I expected this report to be good--with Fantasy, the return of DE (and Grey Knights?)---plus the big year Black Library had.

This report doesn't include their recent PR/Finecast/retail decisions---and this is their second negative sales growth report (-7ish% on this with new releases?!). I think next report is going to be ugly.

boyd wrote:Did any of their stores close based on the turbulence in the country? Did any of them flood or wash away? If so that could be one of the reasons why they closed the shops. We had that issue in Florida when we had 5 Hurricanes and 2 Tropical storms dump 4 feet of water over Central Florida in 2 months back in 2004. Many businesses took their insurance payout and never re-opened. That is an alternative rebuilding and reopening several months later. I can imagine that since there is a lot of upheavel in the country closing the shops in the short term and waiting for the country to stabilize would be beneficial.

The Fukushima Prefecture of Japan is a relatively rural/industrial area on the NE coastline, and is considered rather remote. It is extremely... EXTREMELY... unlikely that there were GW stores there to begin with, and even less so that all of the locations were so closely clustered around the Dai-Ichi plant as to be affected by the tsunamis or radiation.

This is not to say that the closing of the stores is unrelated to the recent turmoil, but for it to have had a direct affect on the properties is a low probability IMO.