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 TheAuldGrump wrote:

 Azreal13 wrote:
You pay a lower rate of tax in the UK from dividends than you do from salaried income.

Take it from a former company director.

Also, GW's cash reserves have taken a beating in the last couple of years IIRC.

Given out in the form of those same dividends....

I wonder what would have happened if Kirby had put that same money into, let's say Market Research and/or advertising?

The Auld Grump

Or spent it on development, or even buying out companies like ffg. They had prettg serious cash to invest and gave it all back to the share holders saying they literally have nothing to do with it.

Herzlos wrote:

 TheAuldGrump wrote:

 Azreal13 wrote:
You pay a lower rate of tax in the UK from dividends than you do from salaried income.

Take it from a former company director.

Also, GW's cash reserves have taken a beating in the last couple of years IIRC.

Given out in the form of those same dividends....

I wonder what would have happened if Kirby had put that same money into, let's say Market Research and/or advertising?

The Auld Grump

Or spent it on development, or even buying out companies like ffg. They had prettg serious cash to invest and gave it all back to the share holders saying they literally have nothing to do with it.

Lets just be thankful they didn't buy out FFG.

GW spends a lot on developing modelling-related stuff, and I echo the sentiment that GW NOT buying FFG is a good thing. Since they don't seem to want to expand beyond their comfort zone, it's a great thing for GW, smaller companies, and their fans that GW never went on a Microsoft-esque spending spree.

I think at one point they could have easily done it, and in the process ruined a dozen budding great companies.

 theHandofGork wrote:

 Enigwolf wrote:

Thanks the for explanation. Then yes, I do completely agree with you. Personally, I'm don't know why GW is a publicly-traded company, and I want to understand the business strategy behind them having done so eons ago. FASA/Ral Partha were never public, and neither was Wizards of the Coast, nor are companies like FFG now.

There was an interview from a (now defunct) wargames magazine with Rick Priestley and John Stallard five or so years back. Both mentioned being part of the management buy out that made GW a publicly traded company. As I recall, Bryan Ansell wanted to get out of the business at the same time as the company was poised for large scale growth. Stallard, leading the sales team, realized they could run profitable stores in much smaller locations than they thought previously. The vision was that every boy should own a football, nintendo, and warhammer box set. They had the vision, but needed the cash to do it..

I believe the interview also mentioned that Kirby was one of the best GM's the two of them knew and an avid gamer at the time. Funny how things pan out.

/facepalm.

 Talys wrote:
GW spends a lot on developing modelling-related stuff,

They spend a tiny amount of their revenue on development.

Their cost of sales includes development, and hovers around 25% of their revenue. So all other associated costs, ie production, packaging etc plus development.

So yes, by the metric of the annual income of your average wargamer, a lot, but relatively speaking? Not so much.


Automatically Appended Next Post:
In fact, in 2011/12, which is the last report they had design and development as a separate entry and not lumped in with COGS, the sum total was <£500k

 Talys wrote:

 Kilkrazy wrote:
GW's problem is not their current balance sheet, cash in hand, cash flow, or profit and loss account. It is the recent trend of declining sales. At some point, if sales should continue to decline year on year, the company's fixed cost base will inevitably change the profit into a loss, eroding cash and reducing the balance sheet, etc.

Each half year's statement, or annual report, is a snapshot of a moment in time. The longer term trend is what is important.

To be clear, the company is currently in a financially healthy position, but its market position has been growing worse for some time and this should give some cause for concern.

Yes, the opposite trend would be better for them!

The question is, does management want to do do the things that would take the company that way. It feels to me that GW is a company that says, "we'll do what we want and the people who like it will give us money", rather than, "what do we need to do to make more money?"

I can actually relate to both, and like I said, at some point GW may have to suck it up and do stuff they don't like so much in order to make the money they need to keep the lights on.

The question is: Will they realize they need to change in time and will they even know what to change? (seeing as how they pridefully don't do market research.)
Yes, as of now, GW is in the black. No one's saying otherwise.
What they are saying as "If this trend continues, they will go out of business sooner than later."
The problem is, their current direction is what's causing declining sales and they show no sign of altering their course. Thus, if they continue as they are, they will fold.
Then you won't have new space marines anymore.

 Azreal13 wrote:

In fact, in 2011/12, which is the last report they had design and development as a separate entry and not lumped in with COGS, the sum total was <£500k

I think that molds or new paintbrushes go under COGS. In comparison, what do you think other companies spend on nonproduct R&D?


Automatically Appended Next Post:

 MWHistorian wrote:
The question is: Will they realize they need to change in time and will they even know what to change? (seeing as how they pridefully don't do market research.)
Yes, as of now, GW is in the black. No one's saying otherwise.
What they are saying as "If this trend continues, they will go out of business sooner than later."
The problem is, their current direction is what's causing declining sales and they show no sign of altering their course. Thus, if they continue as they are, they will fold.
Then you won't have new space marines anymore.

As a personal matter, I'll cross the bridge or no new space marines when I get there. I certainly wont lose sleep over it

I think it's equally prideful to think that any of us could do a better job, because at the end or the day, Kirby et al run a more successful business than I ever have.

 Talys wrote:

I think it's equally prideful to think that any of us could do a better job, because at the end or the day, Kirby et al run a more successful business than I ever have.

There are obvious problems with GW's direction. (supported by shrinking sales numbers that are clear to anyone that can do basic arithmetic) Some are obvious and don't take experts to see. It's not that we can do better, it's that THEY should do better. It's supposed to be their job to fix it.

 MWHistorian wrote:

 Talys wrote:

I think it's equally prideful to think that any of us could do a better job, because at the end or the day, Kirby et al run a more successful business than I ever have.

There are obvious problems with GW's direction. (supported by shrinking sales numbers that are clear to anyone that can do basic arithmetic) Some are obvious and don't take experts to see. It's not that we can do better, it's that THEY should do better. It's supposed to be their job to fix it.

This is one or the downsides of being a public company -- people judge you solely by metrics like, did you sell more? As a private company, those metrics would be different. Often, the most successful of private companies are ones who are happy doing what they're good at and what they want -- not necessarily at profit maximization.

I mean, have you ever considered that GW might actually he happy with where they are and satisfied with their performance overall, even proud of it?

If it were my (private) company, it would be more important to me for my people to be doing what they love, than for me to make more money each year. At some point, the only difference is how much dividends get paid out, and at that point, I would not mind trading profit for satisfaction.

Would I care about who I piss off or alienate? Maybe, maybe not. Depends on a lot of things.

 Talys wrote:

 MWHistorian wrote:

 Talys wrote:

I think it's equally prideful to think that any of us could do a better job, because at the end or the day, Kirby et al run a more successful business than I ever have.

There are obvious problems with GW's direction. (supported by shrinking sales numbers that are clear to anyone that can do basic arithmetic) Some are obvious and don't take experts to see. It's not that we can do better, it's that THEY should do better. It's supposed to be their job to fix it.

This is one or the downsides of being a public company -- people judge you solely by metrics like, did you sell more? As a private company, those metrics would be different. Often, the most successful of private companies are ones who are happy doing what they're good at and what they want -- not necessarily at profit maximization.

I mean, have you ever considered that GW might actually he happy with where they are and satisfied with their performance overall, even proud of it?

If it were my (private) company, it would be more important to me for my people to be doing what they love, than for me to make more money each year. At some point, the only difference is how much dividends get paid out, and at that point, I would not mind trading profit for satisfaction.

Would I care about who I piss off or alienate? Maybe, maybe not. Depends on a lot of things.

That sounds all good and artistic, but it doesn't hold up in real life.
I say that as a professional artist and author.
You can't just pull the "artist card" and say you can just do whatever you want.
There are only two hard rules of writing
If you write something that the fans hate, don't do it.
If you write something they think is awesome, do it.
In in end I'm running a business and I need to by food.
If they wanted to do an art project they should go do that and leave the company to someone else.
But it's true, I didn't consider the possibility that they want to fail. I gave them more credit than they deserve it seems.

It's the job of a business to make money. Of course you'll be judged on how much money you take in. That's the point of having a business.

People often give the excuse that GW is a business and they shouldn't care for their fans. Well, if they're failing as a business because a lot of fans don't feel GW cares then where does that put us?

 MWHistorian wrote:
That sounds all good and artistic, but it doesn't hold up in real life.
I say that as a professional artist and author.
You can't just pull the "artist card" and say you can just do whatever you want.
There are only two hard rules of writing
If you write something that the fans hate, don't do it.
If you write something they think is awesome, do it.
In in end I'm running a business and I need to by food.
If they wanted to do an art project they should go do that and leave the company to someone else.
But it's true, I didn't consider the possibility that they want to fail. I gave them more credit than they deserve it seems.

I write computer software, and I make pretty good money. I could make (a lot) more money if I wanted to, and worked on projects and people I don't really like. I'm not an artist but I care about more things than profit.

And yet, I don't consider myself for being a failure.

If I had to guess, GW feeds more mouths and makes more people happy than you. And me. Put together! for the rest of our lives! does that make us failures?

 Talys wrote:

 MWHistorian wrote:
That sounds all good and artistic, but it doesn't hold up in real life.
I say that as a professional artist and author.
You can't just pull the "artist card" and say you can just do whatever you want.
There are only two hard rules of writing
If you write something that the fans hate, don't do it.
If you write something they think is awesome, do it.
In in end I'm running a business and I need to by food.
If they wanted to do an art project they should go do that and leave the company to someone else.
But it's true, I didn't consider the possibility that they want to fail. I gave them more credit than they deserve it seems.

I write computer software, and I make pretty good money. I could make (a lot) more money if I wanted to, and worked on projects and people I don't really like. I'm not an artist but I care about more things than profit.

And yet, I don't consider myself for being a failure.

If I had to guess, GW feeds more mouths and makes more people happy than you. And me. Put together! for the rest of our lives! does that make us failures?

If such a large percentage of my fans were upset with my work? Then yes.

 heartserenade wrote:
It's the job of a business to make money. Of course you'll be judged on how much money you take in. That's the point of having a business.

People often give the excuse that GW is a business and they shouldn't care for their fans. Well, if they're failing as a business because a lot of fans don't feel GW cares then where does that put us?

Actually, the point of starting a business is often because it's something you're good at that's fun and that you can make a living off of. Making money is important, but it's not the ONLY thing that's important.

Having happy fans is important too, but not everyone has to be a fan for you to be successful. Just enough people that you can do what you want to, and make as much money as you want to.

 heartserenade wrote:
It's the job of a business to make money. Of course you'll be judged on how much money you take in. That's the point of having a business.

People often give the excuse that GW is a business and they shouldn't care for their fans. Well, if they're failing as a business because a lot of fans don't feel GW cares then where does that put us?

It is the job of some businesses to only make money first and foremost, but not all. A lot of starts-ups, these days, operate on the promise of doing something cool, or making lives easier somewhere, somehow, for example.

 MWHistorian wrote:

If such a large percentage of my fans were upset with my work? Then yes.

And yet they must still have a lot of fans. At some point, as I said, if that number falls too low, they have to suck it up and do something they don't want to do.

To give you a comparable, nobody calls Mark at Dreamforge for being a failure for not growing past a 1 person company. It's his choice not to grow past that, and I'm happy that he's found his groove.

 Talys wrote:

 MWHistorian wrote:

If such a large percentage of my fans were upset with my work? Then yes.

And yet they must still have a lot of fans. At some point, as I said, if that number falls too low, they have to suck it up and do something they don't want to do.

To give you a comparable, nobody calls Mark at Dreamforge for being a failure for not growing past a 1 person company. It's his choice not to grow past that, and I'm happy that he's found his groove.

Falling revenue, year on year, despite price increases would suggest that too many of their fans are upset with their work.

If most of my fans were yelling at me to do something different and I continued to sell less and less books, I would be an idiot not to listen.

Making money isn't the only reason, but if you told your shareholders "We're planning to make less and less money every year. Cool?" They probably wouldn't be happy.

If GW does WANT to make more money and then they're just failing at it, it's their own fault.

 A Town Called Malus wrote:

 Talys wrote:

 MWHistorian wrote:

If such a large percentage of my fans were upset with my work? Then yes.

And yet they must still have a lot of fans. At some point, as I said, if that number falls too low, they have to suck it up and do something they don't want to do.

To give you a comparable, nobody calls Mark at Dreamforge for being a failure for not growing past a 1 person company. It's his choice not to grow past that, and I'm happy that he's found his groove.

Falling revenue, year on year, despite price increases would suggest that too many of their fans are upset with their work.

No, it does not. Correlation does not equate with causation.

But you really can't judge a business because "they're doing something fun and they're making a living off of it", is it? That's highly subjective, and a lot of people do business that they don't really like doing because they need the money. That's something a privileged person who don't have problems with money would say.

It's absurd to be like "Sure, let's give GW a free pass on their declining sales because they're doing what the love and that's awesome!" As an investor it would be stupid to think like that.

 MWHistorian wrote:
If most of my fans were yelling at me to do something different and I continued to sell less and less books, I would be an idiot not to listen.

Making money isn't the only reason, but if you told your shareholders "We're planning to make less and less money every year. Cool?" They probably wouldn't be happy.

If GW does WANT to make more money and then they're just failing at it, it's their own fault.

See, the thing is, I don't think GW hears us. It's like screaming at a deaf person who's not even looking anywhere remotely near your direction. When was the last time you recall them doing any kind of mass market research?

 Enigwolf wrote:

 heartserenade wrote:
It's the job of a business to make money. Of course you'll be judged on how much money you take in. That's the point of having a business.

People often give the excuse that GW is a business and they shouldn't care for their fans. Well, if they're failing as a business because a lot of fans don't feel GW cares then where does that put us?

It is the job of some businesses to only make money first and foremost, but not all. A lot of starts-ups, these days, operate on the promise of doing something cool, or making lives easier somewhere, somehow, for example.

It's also worth noting that GW *is* making money, and probably is more profitable than any other wargaming/miniature company. We're comparing GW to GW, saying they're making less money than they used to. They probably have more cash than most other miniature companies too. To turn around and say, "what a failure!" seems a bit comical.


Automatically Appended Next Post:

 Enigwolf wrote:

 MWHistorian wrote:
If most of my fans were yelling at me to do something different and I continued to sell less and less books, I would be an idiot not to listen.

Making money isn't the only reason, but if you told your shareholders "We're planning to make less and less money every year. Cool?" They probably wouldn't be happy.

If GW does WANT to make more money and then they're just failing at it, it's their own fault.

See, the thing is, I don't think GW hears us. It's like screaming at a deaf person who's not even looking anywhere remotely near your direction. When was the last time you recall them doing any kind of mass market research?

The website survey is about the only thing I've ever heard of

Though I think the reps are supposed to make small talk with local stores. Does that count?

@MWHistorian - I get what you're saying, but there are a bazillion authors and screenwriters and producers that do exactly that. M. Night Shyamalan comes to mind...

 heartserenade wrote:
But you really can't judge a business because "they're doing something fun and they're making a living off of it", is it? That's highly subjective, and a lot of people do business that they don't really like doing because they need the money. That's something a privileged person who don't have problems with money would say.

It's absurd to be like "Sure, let's give GW a free pass on their declining sales because they're doing what the love and that's awesome!" As an investor it would be stupid to think like that.

Which is why I'm wondering why GW became a publicly-traded company in the first place.

 Enigwolf wrote:

 heartserenade wrote:
It's the job of a business to make money. Of course you'll be judged on how much money you take in. That's the point of having a business.

People often give the excuse that GW is a business and they shouldn't care for their fans. Well, if they're failing as a business because a lot of fans don't feel GW cares then where does that put us?

It is the job of some businesses to only make money first and foremost, but not all. A lot of starts-ups, these days, operate on the promise of doing something cool, or making lives easier somewhere, somehow, for example.

Is GW a startup company?

And if you have a startup company that does something cool but it doesn't make enough money, is it a successful company?

 heartserenade wrote:

 Enigwolf wrote:

 heartserenade wrote:
It's the job of a business to make money. Of course you'll be judged on how much money you take in. That's the point of having a business.

People often give the excuse that GW is a business and they shouldn't care for their fans. Well, if they're failing as a business because a lot of fans don't feel GW cares then where does that put us?

It is the job of some businesses to only make money first and foremost, but not all. A lot of starts-ups, these days, operate on the promise of doing something cool, or making lives easier somewhere, somehow, for example.

Is GW a startup company?

And if you have a startup company that does something cool but it doesn't make enough money, is it a successful company?

Start-ups were used as an example of a company that isn't making money the first thing on its priority. But yes, to your second question. Please, do you think Oculus Rift or Tesla (minus government subsidies) are actually in the black on their own?

 heartserenade wrote:

 Enigwolf wrote:

 heartserenade wrote:
It's the job of a business to make money. Of course you'll be judged on how much money you take in. That's the point of having a business.

People often give the excuse that GW is a business and they shouldn't care for their fans. Well, if they're failing as a business because a lot of fans don't feel GW cares then where does that put us?

It is the job of some businesses to only make money first and foremost, but not all. A lot of starts-ups, these days, operate on the promise of doing something cool, or making lives easier somewhere, somehow, for example.

Is GW a startup company?

And if you have a startup company that does something cool but it doesn't make enough money, is it a successful company?

This. GW has a responsibility to both its shareholders and its employees to remain profitable. A surefire way to not do that is to lose sales every year and do nothing to correct for it.

 A Town Called Malus wrote:

 heartserenade wrote:

 Enigwolf wrote:

 heartserenade wrote:
It's the job of a business to make money. Of course you'll be judged on how much money you take in. That's the point of having a business.

People often give the excuse that GW is a business and they shouldn't care for their fans. Well, if they're failing as a business because a lot of fans don't feel GW cares then where does that put us?

It is the job of some businesses to only make money first and foremost, but not all. A lot of starts-ups, these days, operate on the promise of doing something cool, or making lives easier somewhere, somehow, for example.

Is GW a startup company?

And if you have a startup company that does something cool but it doesn't make enough money, is it a successful company?

This. GW has a responsibility to both its shareholders and its employees to remain profitable. A surefire way to not do that is to lose sales every year and do nothing to correct for it.

I refer you back to this.

 Enigwolf wrote:

 heartserenade wrote:
But you really can't judge a business because "they're doing something fun and they're making a living off of it", is it? That's highly subjective, and a lot of people do business that they don't really like doing because they need the money. That's something a privileged person who don't have problems with money would say.

It's absurd to be like "Sure, let's give GW a free pass on their declining sales because they're doing what the love and that's awesome!" As an investor it would be stupid to think like that.

Which is why I'm wondering why GW became a publicly-traded company in the first place.

I find the arguement "GW isn't failing because they want to lose customers and sales!" A bit silly.
Let's stick with what we can prove.
GW is pushing out more product than ever, yet their sales are shrinking.

 MWHistorian wrote:
I find the arguement "GW isn't failing because they want to lose customers and sales!" A bit silly.
Let's stick with what we can prove.
GW is pushing out more product than ever, yet their sales are shrinking.

Yes, these are indisputable facts.

The problem is, we can't draw any conclusions from it. It could be, if they pushed out less product, their sales would shrink more. It could be, if they did nothing at all, their sales would be exactly the same. We can't even make a good guess.

Edit: A better way to put it -- if they focused on cheaper products and appealing to a broader base, their total revenue might be LESS than their current strategy, apparently of focusing on more products and appeasing the more hardcore fans.

 heartserenade wrote:
But you really can't judge a business because "they're doing something fun and they're making a living off of it", is it? That's highly subjective, and a lot of people do business that they don't really like doing because they need the money. That's something a privileged person who don't have problems with money would say.

It's absurd to be like "Sure, let's give GW a free pass on their declining sales because they're doing what the love and that's awesome!" As an investor it would be stupid to think like that.

i think doing something you love, and making a living off of it, is the most important thing...
i am not privileged in any way, and have been poor all my life...
i tried doing work that i didn't like, and none of those jobs lasted more than a couple of months before i just walked away, because i would rather be poor than do a job i don't love...
even making $40 an hour was not worth the time it took away from my painting and surfing...

as to your second point, every investor who posts here is very happy with their GW stock, because it pays...

cheers
jah