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Unless you've been sitting in a cave with your fingers in your ears throughout this past year you may have noticed the closure of Battle Bunkers throughout the country. The Battle Bunkers are being replaced by the more common one man shops that Games Workshop has been rolling out for a couple years now. The only explanation for this has been cryptic emails and facebook updates stating that the change from the larger Battle Bunkers to smaller retail shops are somehow better for the hobbyists (?) and that they shouldn't panic. I found this peculiar like everyone else but felt that Games Workshop is a business and the move to smaller shops would cut back on overhead and payroll to make up for lagging sales.

That was until I saw that the Wave Serpent was mysteriously out of stock and that when it returned it would be sold direct from Games Workshop only. That means if you want a Wave Serpent you will either have to order it directly from their website or go into a Games Workshop store to purchase one. It also just so happened that the Wave Serpent has been a very popular release for Games Workshop, so much so that they have seemingly run out of their stock. This got me to thinking. What do the two events have in common? Closing their hobby oriented Battle Bunkers and cutting out independent stockists from selling their most popular models? It appears to me (AND THIS IS MY PERSONAL OPINION) that Games Workshop has come to the conclusion that providing a place for players to play is no longer needed to sell their models. They feel that they are now in the position to sell their models directly to the customers either through their one man toy stores or through their website. They know that players will find a place to play the game, either at a local FLGS (kept in business by card games) or by going to one of the MANY tournaments hosted throughout the US each month (which they don't pay anything for). Why not have them go straight to the source and make a much larger margin in the meantime?

I've written a more extensive article on my blog Kimchi Games (locate the link in my signature) but I wanted to get more Dakkanaughts opinions on the matter. I would hate for this to happen, but it certainly makes sense for a business that possibly hasn't been doing well to try and reduce their expenses and boost their margins. What do you think?

Any chance of breaking it up, making it more appealing than one massive blob of text?

I can sum it up for him.

GW makes more $$$ selling direct from the website.

GW doesn't need to provide extensive game space to drive model sales.

GW figured this out and that is why the battle bunkers are closing.

I think GW has been working towards this approach since 2008 and to a lesser extent before 2000 when they took distribution in house. They've been trying to capture more and more of the money spent on each kit.

During the CHS lawsuit, a spreadsheet of sales numbers by product was released. In it, it basically showed that kits sold well when they were the new flavour of the month and when they were space marines, specifically the core sort of things like troop squad boxes and battleforces. For the new splash releases, the cool big stuff sold well like the vehicle kits and monsters and the like.

The end result is that GW is going to continue on their business model of ignoring the existing customer base in favor of new splash releases being marketed in their stores. They don't need to provide play space or painting space or any of the things their hobby centres provided when they were actually hobby centres. They don't need to "grow the hobby" they just need to make a sale to a new person and maybe a couple birthday and holiday purchases before the new person quits being their customer.

What does paying for space to get people to play do for GW when they expect people to quit buying relatively soon anyway? They'll get your money on the splash releases and maybe a supplemental purchase or two and those that stick around can slowly find themselves buying the most supported army, which is some variation of space marines.

It is especially funny to describe the desired interaction as a hobby.

 Kimchi Gamer wrote:
They know that players will find a place to play the game, either at a local FLGS (kept in business by card games) or by going to one of the MANY tournaments hosted throughout the US each month (which they don't pay anything for).

You forgot the most common option - play at someones house. Playing at the local store is a primarily American habit. In the rest of the world, gaming at stores is far, far less common, and more common is simply throwing a table together at someones house and playing there.

If they do give up on providing a place to play and think they then they are giving up on GW-only customers. They have always tried to make their customers reliant solely on GW to the exclusion of all else, even on things like glue which is available cheaper and better elsewhere.

If you don't play in a GW store there's no reason to have a GW only army, and you'll be exposed to a lot wider hobby much faster. This is great for the hobby but I don't see that it helps GW that much really unless they only expect most customers to only come back once or twice.

So GW should keep massive money losers like the bunker stores open so people can game there? Yup, sounds like sound business advice from the internets.

The Battle bunkers based on their size would have massive overhead in rent, overhead not being met by store sales. The baltimore bunker made sense when GW USA's headquarters was there, same with the bunker in Ontario for GW Canada's headquarters. LA was apparently losing money hand over fist and I have no clue about Chicago though I heard it actually makes money.

As for the big one, Warhammer world which is attached to GW global HQ....apparently all the events there are run on the basis that they pay for themselves.

I can't speak to the rest of the sky is falling arguments in the OP, but the bunkers closing is due to the fact they were either in the red, or their reason for being was no longer needed (IE, respective HQ's being shut down/consolidated in the Memphis bunker)

Their business model is still all about the short term, so no, it's not really changing. The methods in which they do that are changing however, specifically tightening control on who sells what and removing popular items from stockists so that they get all the benefits.

Orktavius wrote:
So GW should keep massive money losers like the bunker stores open so people can game there?

Strawman much?

A strawman seems appropriate for a chicken little thread..... So Sue me.

Like I said, I'm only commenting on the bunkers, that LA bunker would have to move mountains of product to cover the rent on a space that size where it is/was.

Actually, a store losing money isn't a deal breaker when you are talking about a national or global chain.

There are many more considerations that come into play, such as having a presence in a given area, suppressing competitor activity, being able to offset gains made elsewhere to avoid tax etc etc..

Someone at GWHQ has clearly decided that any of these additional factors are now no longer worth the overhead, or GW really are cutting things to the bone in order to maintain their profit levels. Either way, the decision to close a store that's part of a chain is more complex than if it makes money or not.

Depends on how much money your losing, I don't think Westminster California is likely to be the cheapest area to rent a few thousand feet of retail space for the sake of gaming.

Orktavius wrote:
Depends on how much money your losing, I don't think Westminster California is likely to be the cheapest area to rent a few thousand feet of retail space for the sake of gaming.

No, it really doesn't depend on how much money it's losing, it only depends on whether the more intangible or indirect benefits are deemed worth it. If for instance, the Bunkers were doing an exceptional job of pulling people in from a wide catchment area, recruiting them and then sending them back home where they then proceeded to buy from other, more local, sources, then if they lost $1000000 a month, but generated $1100000 in indirect sales by creating customers where there previously had been none, they'd be worth taking the hit on. All purely hypothetical of course, and highly unlikely, but just trying to illustrate how you need to take a holistic view with multi site retail, and a store making a loss isn't necessarily reason to close.

 Howard A Treesong wrote:
If they do give up on providing a place to play and think they then they are giving up on GW-only customers. They have always tried to make their customers reliant solely on GW to the exclusion of all else, even on things like glue which is available cheaper and better elsewhere.

If you don't play in a GW store there's no reason to have a GW only army, and you'll be exposed to a lot wider hobby much faster. This is great for the hobby but I don't see that it helps GW that much really unless they only expect most customers to only come back once or twice.

This.

The one thing we know in the UK at least, a massive part of their business, is that they are reliant on recruiting young teens to maintain sales. Without a store network, they simply won't do this, and without a store network, their peripheral ranges, like paints, glues, accessories, will die.

GW are also opening stores - I noticed a new one on the way in INverness and another one in Rotherham.

I would be pretty certain they're intent on keeping their own stores, and that the closure of the Battle Bunker is an attempt merely to keep this year's budget on-track by cutting costs on one under-performing outlet. IN the same way, delaying supplies to other retailers, so their own stores get the biggest benefit from a sales spike on new product, would lift the figures too.

Exactly. GW wouldn't be the only multi store company to hold store space in an area to simply keep away a competitor. In the UK we have a big supermarket chain who is known for buying land with no intetiion of using it simply to keep it out of other rivals hands.

Plus many also have loss leaders to attract you in to buy other things. I can't see it being too dissimilar from running a loss making store that encourages other sales elsewhere. You need to consider the whole picture of the company.

Hivefleet Oblivion wrote:

 Howard A Treesong wrote:
If they do give up on providing a place to play and think they then they are giving up on GW-only customers. They have always tried to make their customers reliant solely on GW to the exclusion of all else, even on things like glue which is available cheaper and better elsewhere.

If you don't play in a GW store there's no reason to have a GW only army, and you'll be exposed to a lot wider hobby much faster. This is great for the hobby but I don't see that it helps GW that much really unless they only expect most customers to only come back once or twice.

This.

The one thing we know in the UK at least, a massive part of their business, is that they are reliant on recruiting young teens to maintain sales. Without a store network, they simply won't do this, and without a store network, their peripheral ranges, like paints, glues, accessories, will die.

GW are also opening stores - I noticed a new one on the way in INverness and another one in Rotherham.

I would be pretty certain they're intent on keeping their own stores, and that the closure of the Battle Bunker is an attempt merely to keep this year's budget on-track by cutting costs on one under-performing outlet. IN the same way, delaying supplies to other retailers, so their own stores get the biggest benefit from a sales spike on new product, would lift the figures too.

Mark it on the calendar, we are of an accord!

Although I do wonder if de emphasising the focus on recruiting through their own stores in favour of focusing on development of products that would stand on their own merits in independent stores might not be a better long term plan. Still, can't do anything that might affect the bottom line and spook the shareholders eh?

GW decided long ago to not try to compete with anyone. They handed over more than half their market share between 2000 and now to other companies and have done more and more to segregate themselves from other offerings as if by doing so they can claim to have no competition.

We also know they are not interested in gaining benefits from a store beyond cold hard cash. The managers are all performance benchmarked and will lose their jobs unless they meet GW's sales growth demands. And given that each and every year the target is a percentage increase over the previous year means that staff end up competing with their past success in order to keep their job. They are only interested in the stores selling product and always selling more than the previous year.

They are no longer interested in developing a community around their stores and want people to buy and get out as quickly as possible.

So why bother spending the extra money on more space and more staff? It doesn't match up with their goals to get new people in and get as much money from them as possible before they quit while spending as little as possible to make it happen.

GW also has an administrative bloat with retail/sales staff being cut, production staff being cut but administrative staff going up in both numbers and cost. Given their internal culture of viewing gamers as rubes or plebs, they want the sales force to do as much as possible for as little as possible.

But here the shrinking customer base is hurting them as well. They are now having to headhunt suckers for the jobs of running these stores and being put in the firing line of every increasing sales targets to satisfy the corporate yes-men above them. It used to be that having a larger customer base meant that it was very easy to find staff who actually loved the games while now they are left with a split of gamers and those who look down on gamers.

 H.B.M.C. wrote:
Their business model is still all about the short term, so no, it's not really changing. The methods in which they do that are changing however, specifically tightening control on who sells what and removing popular items from stockists so that they get all the benefits.

Exactly. This direct only approach will only work for people who are already committed, and whilst you've got FLGS support. When FLGS's get put off by GW policies (meta-required gaming components being direct only for instance) then they'll start promoting ranges they can sell in store, and new customers will be starting elsewhere.

Once the FLGS's stop promoting GW (and I've seen it happen; the proportion of GW stocked in the FLGS's I visit are reducing), and the existing bought-in-customers move on, they are going to really start struggling for growth as all the things responsible for the growth (community, playing spaces) will have gone and they'll have to do a massive U-turn to try and stay relevant.

In the short term it's brilliant though; direct sales are much more profitable, especially since they are ordered on demand. In the long term it's frankly stupid.

 frozenwastes wrote:
Given their internal culture of viewing gamers as rubes or plebs, they want the sales force to do as much as possible for as little as possible.

Evidence?

I'm sure are cynical sales staff and vacuous marketing people in GW, as there are in so many similarly-sized companies. Few people here argue that GW is focused on the short term (altho, also, in the current financial market they're doing pretty well).

But that's a big accusation - so do tell where this information come from.

Hivefleet Oblivion wrote:
GW are also opening stores - I noticed a new one on the way in INverness and another one in Rotherham.

And a closed one at Meadowhall.

The Rotherham store is basicly the Meadowhall one moved 5 minutes away.

Hivefleet Oblivion wrote:

 frozenwastes wrote:
Given their internal culture of viewing gamers as rubes or plebs, they want the sales force to do as much as possible for as little as possible.

Evidence?

I'm sure are cynical sales staff and vacuous marketing people in GW, as there are in so many similarly-sized companies. Few people here argue that GW is focused on the short term (altho, also, in the current financial market they're doing pretty well).

But that's a big accusation - so do tell where this information come from.

There's been various little tidbits pop up here and there, nothing conclusive of course, but there was something derogatory posted on a senior managers personal Facebook feed which leaked (but was questionable whether he still worked for GW when he posted it)

I believe there have also been quotes attributed to some senior executive or another, and the odd "GW insider" will pop up now and again to echo the sentiment.

Nothing you'd convict on, but interesting if you subscribe to a "no smoke without fire" way of thinking.

 azreal13 wrote:


There's been various little tidbits pop up here and there, nothing conclusive of course....

Believing your customers and mugs and idiots would be a pretty profound element of corporate culture, if true... that one story about a FLGS manager who held GW stock calling people mugs got a huge amount of attention, and he wasn't a GW employee IIRC.

Surely any substantive evidence would be seized on and repeated - because it's what a certain kind of person would love to hear!

Hivefleet Oblivion wrote:

 azreal13 wrote:


There's been various little tidbits pop up here and there, nothing conclusive of course....

Believing your customers and mugs and idiots would be a pretty profound element of corporate culture, if true... that one story about a FLGS manager who held GW stock calling people mugs got a huge amount of attention, and he wasn't a GW employee IIRC.

Surely any substantive evidence would be seized on and repeated - because it's what a certain kind of person would love to hear!

The Facebook thing I saw screen caps of with my own eyes, wasn't anything original, just rattling on about smelly nerds sort of thing. It was also definitely the correct individual, the only doubt was there was conflicting info as to whether he worked for them when he said it, as I mentioned.

The other stuff could be hearsay, I've only seen it referred to, but often. Perhaps a longer serving member than I, with an elephantine memory, could perhaps link to something more concrete.

As they sell more scenery and terrain, they provide more reason for people to play away from the stores.
They want us to by lots and lots of that, and having tables set up in stores means there is little need to have lots.

Hivefleet Oblivion wrote:

 azreal13 wrote:


There's been various little tidbits pop up here and there, nothing conclusive of course....

Believing your customers and mugs and idiots would be a pretty profound element of corporate culture, if true... that one story about a FLGS manager who held GW stock calling people mugs got a huge amount of attention, and he wasn't a GW employee IIRC.

Surely any substantive evidence would be seized on and repeated - because it's what a certain kind of person would love to hear!

Quote from a BOLS article:

-Mr. Merrett described Games Day to the jury as a Games Workshop event that allowed customers to perform their "favorite hobby activity; buying things from Games Workshop".

I think it will be interesting to see what else Mr. Merrett may have said about his own customers when the transcripts are available. So too with Andy Jones. In a likelihood of confusion argument you have to talk about the customers. That snippet from Merrett is what I would call smoke. We'll have to wait and see if there is any fire.

They're going to wind up taking a much bigger slice of a much smaller pie.

It's very short sighted. Long term, the only way to grow sales is to grow the hobby.

The best ambassadors for the hobby are other players.

All the GW stores I've ever been to have been terrible places to play a game.


Automatically Appended Next Post:

Orktavius wrote:
So GW should keep massive money losers like the bunker stores open so people can game there? Yup, sounds like sound business advice from the internets.

The Battle bunkers based on their size would have massive overhead in rent, overhead not being met by store sales. The baltimore bunker made sense when GW USA's headquarters was there, same with the bunker in Ontario for GW Canada's headquarters. LA was apparently losing money hand over fist and I have no clue about Chicago though I heard it actually makes money.

As for the big one, Warhammer world which is attached to GW global HQ....apparently all the events there are run on the basis that they pay for themselves.

I can't speak to the rest of the sky is falling arguments in the OP, but the bunkers closing is due to the fact they were either in the red, or their reason for being was no longer needed (IE, respective HQ's being shut down/consolidated in the Memphis bunker)

No, GW shouldn't keep failing stores open. But, then, they seem to be opening a lot of stores that have no hope of breaking even.

But, there are plenty of independent stores that serve as great outlets for GW products that the company seems outright hostile toward, i.e. no online sales, no bits sales, lots of kits being direct order only, et cetera.

I mentioned it in the wave serpent thread but the wave serpent isnt truly direct only, FLGS can still get the wave serpent, it just costs the store more then a standard kit and GW makes no promises on when it will actually ship to the store. I currently have 3 on order on my FLGS (they discount 15% off GW product) and they had no problem putting the order in with there GW rep

Hivefleet Oblivion wrote:

 azreal13 wrote:


There's been various little tidbits pop up here and there, nothing conclusive of course....

Believing your customers and mugs and idiots would be a pretty profound element of corporate culture, if true... that one story about a FLGS manager who held GW stock calling people mugs got a huge amount of attention, and he wasn't a GW employee IIRC.

Surely any substantive evidence would be seized on and repeated - because it's what a certain kind of person would love to hear!

Even though this is slightly off topic, I've been in a job interview with GW North America and I can personally attest to this attitude. When I first began the interview the man who shan't be named introduced himself as the guy who does the management hiring in the US. At first he seemed pretty much what I would expect a GW exec to sound like in terms of touting the company glories and products, etc. Once he learned that I had management experience previously and having stating something about wanting to really manage a shop and not have it be just a hobby of mine he quickly dropped his guard and started speaking more like some of the people above me mentioned. All of the sudden he couldn't keep the contempt for the gamers out of his voice. I believe he actually sneered when talking about them. He told me the only reason to get them in the shop was to make sales and then get them out before they stop others from purchasing stuff. He also admitted he didn't play any of the games. Again, that was a personal experience in a very strange job interview (that I go but declined) but it really showed me (at least in the upper management) how much they care about the actual gamers who buy their product.

 ironicsilence wrote:
I mentioned it in the wave serpent thread but the wave serpent isnt truly direct only, FLGS can still get the wave serpent, it just costs the store more then a standard kit and GW makes no promises on when it will actually ship to the store. I currently have 3 on order on my FLGS (they discount 15% off GW product) and they had no problem putting the order in with there GW rep

I think it was mikhaila that said that a FLGS needed about a 30% margin to break even.

So if your store is getting a reduced margin from GW themselves and are putting on a 15% discount on top of that, are they even making any money on those kits or are they ordering them just as a favour for their regular customers?

PhantomViper wrote:

 ironicsilence wrote:
I mentioned it in the wave serpent thread but the wave serpent isnt truly direct only, FLGS can still get the wave serpent, it just costs the store more then a standard kit and GW makes no promises on when it will actually ship to the store. I currently have 3 on order on my FLGS (they discount 15% off GW product) and they had no problem putting the order in with there GW rep

I think it was mikhaila that said that a FLGS needed about a 30% margin to break even.

So if your store is getting a reduced margin from GW themselves and are putting on a 15% discount on top of that, are they even making any money on those kits or are they ordering them just as a favour for their regular customers?

I have noted several gaming stores that basically do just that. They don't keep GW stock on the shelves, but will place orders for existing customers.