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 Ailaros wrote:


And the answer, there as here, is that people who want to be vindictive about GW not doing things the way they want will always project a perceived failure in their products or business practices as an imminent failure of the business itself.

Well, allow me a specific in order to disprove your general. I have no axe to grind against GW, I'm not in the least vindictive, I respond honestly to each and every incident that comes out of Lenton, whether that be financial news, policy change or product release. I think GW could be in real trouble.

Neither is anyone predicting the imminent failure, at least nobody with any chops as far as I've read.

And it never happens. At which point, like people predicting the second coming of Jesus, the goalposts get moved again, and THIS time it's totally going to happen for real this time. A newly divined prophecy. The heavens themselves predict GW's failure!

Correction.

It hasn't happened yet.

In actual fact, nobody has really changed what they've been predicting, just some have been a little premature. There's an increasing amount, in terms of anecdotal evidence, hard fact and inference, to suggest that we are finally seeing the point of make or break, and continued progress on their current path may be terminal. That's what makes the imminent financials so interesting and important, because that will either support the theory or disprove it.

But then, I see many people proclaiming "the end of GW" using facts and figures to back up their argument, and often providing reasons why they might be able to offer insight into the situation in terms of professional or academic knowledge dismissed as haters, perhaps I just need to dismiss those who tell me "everything is fine" without providing a shred of reasoning as to why as vacant, clueless, sheep and move on?

Even if GW releases 8th Edition and its such a major bomb that it gets the same sales as the Virtual Boy, GW wont go under. They will still sell models and such, because people will just taboo 8th edition and stick to 7th, since iirc thats what people did with Fantasy.

It will take a lot of bad sales to kill GW, and bad by their standards not what you would normally think bad.

 Vineheart01 wrote:
It will take a lot of bad sales to kill GW, and bad by their standards not what you would normally think bad.

A special kind of bad

GW's core business is the splash release of new stuff. It sells so much better than their existing product line (see CHS lawsuit sales spreadsheet) and then trails off. So if they can keep releasing new stuff, people will keep buying it. And the new Santorum Reach box set shows they can even take existing kits, add a couple new characters and a rulebook and people will buy it as if it is a new product. So they even are stumbling on a way of reselling existing kits as new releases.

Hmm... people seem to love our new releases. I wonder what we can do to sell our existing products as if they were new releases? A box, a book and a couple characters. Get that tooled up right away!

The fact that there are enough people buying to cause that set to sell out so rapidly who normally would never buy 10 grots and a few kans separately makes me think there really are enough true believers to keep GW going.

---

The new box is selling because of a heavy discount and containing a small rulebook, both of which players really want. With regards to the discount on pre-existing kits it's no different than the other bundles GW is doing like SM SF and SM SF Ultra.

 Vineheart01 wrote:
. They will still sell models and such, because people will just taboo 8th edition and stick to 7th, since iirc thats what people did with Fantasy..

Maybe in some areas. From what I've seen, people mostly just stopped playing Fantasy.

Just look at the half year report of the Australian Market. I million+ pounds loss of sales, however the cut operational costs by 1.5 Million+ pounds in the six months to post an operational profit.

I have been told that Games Workshop will go very close into posting a full year sales loss of up to 2 million pounds in the Australian Market alone, but have cut costs by 2.5 million pounds in the Australian Market to make 500,000 pounds profit.

Sounds great but not only they are cutting to the bone, they are sucking out the marrow. The level of one man stores are becoming the norm, while they are shut for two days per week their opposition is open 7 days a week.

Also here is something that isn't published and that is the terms of contracts to indies in Australia, Games Workshop is telling indies that in re-negotiation of their contracts that they have to expand their range of GW product and if they can't due to limited floor space they'll terminate their contracts. GW are playing hardball with indies.

I actually two years ago predicted that the GW Battle Bunker in Parramatta would close, it did two months ago, due to negative sales unable to recoup operational expenses and I know of a further 4 GW stores that closed for the same reason.

Also the erratic pricing of the Australian Market, it does not make any sense. then there is the exponential price increase, take for example when Assault on Black Reach was launched it cost me $85.00 AUD and four years later it sold for $165.00 AUD, meaning that in 5 year the same product increased by more than 90%.

Again, we are all just speculating. The proof is gong to be in the pudding, as they say.

GW had one of their worst reports ever in the last six months, the only exception being when the LOTRO bubble burst a while back. This next financial report, and why so many are interested in it more than ever before, is really going to be the telling sign of what the future of GW is going to be. If, for some reason, they actually increased sales YoY in the period and made up some of the loss from the prior period, than maybe they will keep struggling along for a while. If they post a decrease in this coming period reporting, as well as the prior period, in spite of a rapidly accelerated product release cycle topped off by one of their biggest selling products (the 40k rules), then it will be the amount of decline that will dictate just how much trouble GW is truly in. Anything 15% or more of decline in the coming period reporting and it is a very clear sign that GW is in a lot of trouble and things definitely are not like they were anytime in the past.

As for them selling out products, I don't put too much on that as we do not know the run quantities. Lately, it seems 1,000-2,000 is the norm. Too me, it seems rather dumb to keep releasing things in quantities that would sell more, and make more revenue, but not do it. I can only gather this is because costs are now being watched so tightly they are actually cutting into their ability to generate revenue as a result (otherwise a common occurrence near the closing cycle of the death spiral)

 Achaylus72 wrote:
...while they are shut for two days per week their opposition is open 7 days a week.

Which of GW's competitors has stores in Australia?

Every one that sells through established distribution channels?

 frozenwastes wrote:
Every one that sells through established distribution channels?

Their war upon the Independents who carry their product and pay the costs associated with doing so has always baffled me. Especially since they began cutting costs so aggressively.

 insaniak wrote:

 Achaylus72 wrote:
...while they are shut for two days per week their opposition is open 7 days a week.

Which of GW's competitors has stores in Australia?

At this point, the competitors don't need dedicated stores to kill GW. FLGS support of GW products has fallen dramatically around my area over the past 10 years. If the local GW closed and the FLGS didn't increase their support (and they might since there would be some displaced GW players) then for me there'd be very little point continuing GW products as there'd be almost no where to play.

Eldarain wrote:

 frozenwastes wrote:
Every one that sells through established distribution channels?

Their war upon the Independents who carry their product and pay the costs associated with doing so has always baffled me. Especially since they began cutting costs so aggressively.

It's their desire for margin protection at all costs. They see independent stores as chumps to be used to build their market share and then they do their best to steal the client base developed by their "business partner" with direct only releases, unreliable pre-orders for independents, limited allocation of products and draconian sales terms (which I hear are getting worse in Australia with higher minimums and mandatory products to be carried both being on the rise).

If you knew how many Stormclaw sets were snatched by resellers, you'd be less surprised why it sold out as quickly as it did. Also consider that no new player got their mitts on it, since it largely sold out before it even hit store shelves.

If offered a low enough price, people will buy even Killa Kans. Raw Stormclaws frames are being offered at 60% of RRP. If I had an ork army, I'd get one set too, even if I didn't plan on using it.

 frozenwastes wrote:
Now it's become Epic in 28mm with bad rules.

I pointed up my 5000 point Epic Armageddon Space Marine army (this is the standard game size, so around 2/2.5k points in 40k term) using the new Marine codex and it came to just under 3000 points. To put it another way a normal sized army for a 6mm mass battle game is now only slightly smaller in terms of model count than a 28mm skirmish game. As Epic infantry are mounted 5 to a base the number of individual components in the 40k army is actually far higher. This is an excellent illustrator that something has gone very badly wrong. Epic also managed to fit its entire rules inside 20 pages, GW can't manage to fit 40K's rules inside 120 (unless they have manged it in 7th which I doubt).

I predict that 7th will have buoyed up GW's sales to a reasonable degree, enough to make this years report look decent at least, which is why 7th was released early. Next years report will have to rely on Fantasy 9th and things will be looking a lot less rosy then.

While I don't want GW to die I certainly think they aren't doing well. I refuse to buy rules anymore since they are so expensive and so poorly written. And by that extension, I don't buy models since I have nothing to do with them.
All fine and well to make a miniatures first company, but if there's no game, what in God's name am I supposed to do with the things?
Display them? Well there's other, cheaper, better miniatures for simple display out there.
I want a half decent game I can actually take part in, afford at least the rules and not fear they'll become useless in a short period of time.

And another thing, the GW here is quite small, so playing there is unfeasible, so I go to one of the many FLGS here and am tempted by other games, many other games.
And I wish, I wish GW could give me the game I loved so much 10 years ago. I would buy a sisters of battle army new if it was like that, but it's not. One cannot cling on forever, even if the company exists another 5, 10 however long years.
I won't even guess at how long they will continue for, I don't know business.
But I will feel sad whenever the day comes they do go away (be it a year or ten or fifty)

 insaniak wrote:

 Achaylus72 wrote:
...while they are shut for two days per week their opposition is open 7 days a week.

Which of GW's competitors has stores in Australia?

Every FLGS.

Opposition in the retail sector doesn't have to be bound to a specific company.

 Rommel44 wrote:
Sad thing is if GW lowered there prices on all the models I guarantee that they would generate a lot more business. Never understood why so many businesses ignore that fact. GW will be alright, they are still a very popular game and will be for a long time to come (I hope).

It's the Harley Davidson business model. If you've ever owned a Harley then said feth this POS and sold it after millionth time you've been stranded on a roadside. That's it.

Maybe I'm a malcontent.

They have the kind of opposition they have never come across before.

More people are playing different games, this is largely due to accessibility being much better than before.

People are spending hundreds and in some cases thousands on other model companies, much of this through things like Kickstarter - that is less money being spent on GW models.

I think it will continue to drop for a while before leveling out, if it drops off altogether think the gaming community should be worried as a whole -however I doubt this very much as while we are now in abundance of smaller scale and skirmish games popping up left right and center there is still no really good large scale game to actually contend with 40k for the people who like this sort of game. 2 bad financial reports is not automatically indicative of the future trending.


I disagree lowering the price would generate a lot more business, it might help the pick up a little bit. People can be priced out sure - it's always been a expensive hobby. People who don't have the money or don't want to spend it have the options of smaller scale games.

 Vineheart01 wrote:
Even if GW releases 8th Edition and its such a major bomb that it gets the same sales as the Virtual Boy, GW wont go under. They will still sell models and such, because people will just taboo 8th edition and stick to 7th, since iirc thats what people did with Fantasy.

Europe, where WHFB is still active, used 8th and changed the terribly flawed rules to construct a competitive ruleset that is widely used at most tournaments.


Automatically Appended Next Post:

 Palindrome wrote:
GW can't manage to fit 40K's rules inside 120 (unless they have manged it in 7th which I doubt).

210 pages

 Sigvatr wrote:


Europe, where WHFB is still active, used 8th and changed the terribly flawed rules to construct a competitive ruleset that is widely used at most tournaments.

Where would I be able to get an English copy of these modified rules.?

 loki old fart wrote:

 Sigvatr wrote:


Europe, where WHFB is still active, used 8th and changed the terribly flawed rules to construct a competitive ruleset that is widely used at most tournaments.

Where would I be able to get an English copy of these modified rules.?

European Team Championship(ETC) rules comp. Rebalanced armies, rule calls made by the TO's instead of waiting for FAQ and stuff. Pretty nice, but even they tend to bone some armies and refuse to make them a bit less bad, judging some stuff on utterly abstract possibilitles(i.e. - beastmen; still pretty bad despite their attempts to balance them or Empire getting nerfed even if it was a middling army).

 Palindrome wrote:
I predict that 7th will have buoyed up GW's sales to a reasonable degree, enough to make this years report look decent at least, which is why 7th was released early. Next years report will have to rely on Fantasy 9th and things will be looking a lot less rosy then.

I'm not so sure about this one.

First, the LE run was 40% of the previous edition yet took over a month to sell out whereas 6th edition LEs were gone in hours.

Secondly, there have been two reports now from distributors of Dystopian Wars 2.0 outselling 40k rules by 6:1 in one case and 7:1 in the other. That is either an enormous volume of Dystopian Wars players or a dramatically smaller base of 40k players than in the past.

Third, there are many "rumours" floating around from people who know store managers working for GW, including myself, and I haven't heard or seen a single report yet that a store is making quota. I have read about or heard plenty of reports that sales are doing the worst they ever have for the stores. Additionally, it was floated that it is so bad GW has given up on "recruiting" new people to the HHHobby and instead are pushing store managers to sell anything to anyone who can fog a mirror.

Maybe the reports will prove this anecdotal evidence wrong, but I would honestly be surprised if that is the case. One other observation. Since about December of last year, GW seems to be struggling to keep inventory in stock, especially on new release items. They had a very poor showing on Wood Elf release, and the same thing is now happening with the Orc release. In my experience, this is from a company watching manufacturing inventories a bit too closely and consistently underestimating demand, or running things far short of demand just to avoid having inventory on the books.

Over the course of this year already, there just seem to be too many signs that things are not well for GW. If the assumptions Painting Buddha put forth on earnings does in fact play out as he surmised - then GW is in even worse shape than a skeptic such as myself even believes they will be.

 Wayshuba wrote:
Maybe the reports will prove this anecdotal evidence wrong, but I would honestly be surprised if that is the case. One other observation. Since about December of last year, GW seems to be struggling to keep inventory in stock, especially on new release items. They had a very poor showing on Wood Elf release, and the same thing is now happening with the Orc release. In my experience, this is from a company watching manufacturing inventories a bit too closely and consistently underestimating demand, or running things far short of demand just to avoid having inventory on the books.

Over the course of this year already, there just seem to be too many signs that things are not well for GW. If the assumptions Painting Buddha put forth on earnings does in fact play out as he surmised - then GW is in even worse shape than a skeptic such as myself even believes they will be.

Now that's an interesting concept. What if the reason things were limited edition is that they know that sales are dropping and don't want to be stuck with let's say 500,000 (pulling number out of my behind, don't read into it) copies and only sell 200,000, so instead they only make 150,000. That's a somewhat scary thought, if everything is limited stock because they are so afraid of misjudging the demand that they would rather sell out of something good than risk having surplus with nobody to buy it. Now I'm not a business person but wouldn't that indicate that things are extremely dire, if they're lowering supply out of fear of limited demand? Kind of like if you have a big restaurant, it's morale-crushing to have it empty or with only a handful of people, but if you have a small diner with only a few seats to fill...

GW "going under": yes.
With present decision making and methodology not changing it is a sure thing.

The difficulty is when, when there is no more fat to trim and they have to look elsewhere for available money.
That would be the time there is a chance for it to get better: when they look at how to increase sales.

I expect it to downturn where they will no longer be relevant: other games will be more of a draw (fantastic competition right now) and GW's capabilities will shrink and not be able to keep up to the releases they used to make.

GW is realizing there are too many second hand models out there and only the forced purchases (BRB, Codex) are making good money and book prices are not very competitive right now. $44 Shock attack gun "new model" really makes you want to look for the old versions.

Hope they hang in there a bit longer until they can get new board members that may have played 40k and FB but managed to like it.

Palindrome wrote:To put it another way a normal sized army for a 6mm mass battle game is now only slightly smaller in terms of model count than a 28mm skirmish game. As Epic infantry are mounted 5 to a base the number of individual components in the 40k army is actually far higher. This is an excellent illustrator that something has gone very badly wrong.

In an interview with the malifools podcast, Rick Priestly told a tale about when the higher ups at GW (which was much smaller at the time) went to a local fish market. All the other fish markets had closed down and they asked the guy how he stayed in business. His response was "sell more fish" and that become an internal corporate mantra. Sell more fish! So they made the rules for 40k into a vehicle for an ever increasing model count to sell as many miniatures as possible to people before they quit.

Funny that they didn't stop and think that fish vs miniatures are apples vs oranges in that more people eat fish than will ever buy a GW miniature so you need to pull in as many customers as possible and keep them coming back for more, not churn and burn. They may have realized this too late with the rapid release cycle but only in part with the pricing and day 1 dlc nonsense.

It's a fable from one of those corporate self-help books. I would be very dubious that it actually happened.

I forget which books it's in, it could be Who Moved My Cheese or Soft Selling In A Hard World, or another one of that ilk.

Rick Priestly recounted it as if he was there. I dunno.

Wouldn't be the first time somebody had been slightly elaborate with reality in an interview.

Maybe it did really happen to him, and it's just coincidence, or maybe that's the genesis of it, who knows?