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Is manufacturing in Europe and North America realistic?

Andrei Novac
Poland
Warszawa
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My previous post contained a pricing breakdown for a board game and how that affects the overall cost for the final customer. And I made a promise to discuss the possibility to produce games locally, closer to the customers, in Europe and USA respectively. But before we go into details about what local production of board games means, let's take a quick look at a few facts about where our customers are based.

Location, location, location

In the board game industry there are two major business models when it comes to reaching our customers: direct sales (usually represented by crowd funding) and the classic model. In the classic model, games make their way from the publisher, to distributors, from there to retailers and finally to the gamers.

In the first model - in my case Kickstarter - it is really easy to make a breakdown of where all the pledges go. To have an accurate view (least biased by campaign specifics) I used 3 campaigns made by Board&Dice and one by another publisher (which I used simply as a threshold for eliminating bias).

From gallery of anovac


To reduce shipping costs and minimize environmental impact, from the crowdfunding model it would seem best to manufacture in North America and/or Europe. But before we draw any conclusions, let's have a look at another set of data: how does the classic mode do in comparison. To have a good overview, I used the data from all games published by Board&Dice in 2020 and 2021, as I do not have data from another publisher (and I would speculate that no one would share their whole business model with me ). Games are once again grouped by the region where we delivered them, regardless of the language edition (for example in the Middle East and Asia we also see English copies on top of localized ones).

From gallery of anovac


With the crowdfunding model, Europe and North America together represent 90% of our customers. When we look at the games sold through distribution, these two regions combined represent only 83%, Asia and South America are growing (this is not represented in the charts above) but they still make up a rather small piece of our revenue. And yet, all our games are made in Asia. Let's analyze why!

Cost comparison

Initially I wanted to share a bit of the history of our own path through European and Chinese manufacturing partners, but then I decided to stick to raw data. I needed an example, but one that would not distort the results, that would not introduce a bias. We'll go back to this, turns out that history is needed

Plastics

Everyone knows that all games containing plastic miniatures are made in China. Well... almost everyone. When we first started in this industry and we made Exodus: Proxima Centauri, we made it in Poland, even though it had plastic minis. I had searched for 2 years some European manufacturers of plastic minis, I talked to a few dozen companies, and even though Exodus (revised edition) is made by Granna in Poland, its minis and dice are made in China. That's when I joined the community of people who know that minis are made in China! Why? Simply because either no one would even consider production runs of under 1M piece, or because those who did offered prices that were off the charts (up to 25 times what we expected to pay).

That's when I also understood the process of making plastic miniatures and why it is so expensive to make them in Europe. But the reality is that very few games contain indeed plastic pieces. In fact, my estimation is that less than 15% of games have miniatures inside (probably a realistic number is 5%, and only thanks to publishers like CMON or Awaken Realms).

Cost comparison

Detour is over. To keep the comparison fair, I had to take a look at a game that was made mostly of paper/cardboard components and some wooden pieces. But since not all wood is the same... let's take another small detour.

Custom wooden pieces

If you've played (or, at least, seen) Yedo: Deluxe Master Set or Snowdonia: Deluxe Master Set, you must have noticed that there are a lot of wooden pieces which have custom shapes and/or high quality printing on them. While none are manually painted, they do not use the classic way to print on wood which is silk screening, but rather a more modern technology which factories in China call (or used to call) plastic printing or hot printing. While this technology does not use plastic, it does provide a long lasting print, almost as good and as colorful as an image on paper. We used it before for the pyramid tiles in Teotihuacan: City of Gods and we were impressed with the quality.

Board game factories in Europe can source wooden pieces at a competitive price, they can even customize to some extent the wooden pieces, but the moment we (publishers) request either complex wooden pieces, or with high quality full color printing, they - the European manufacturers - cannot provide a local solution, which means that they have to outsource this to a factory in China.

Later edit: I compared prices for 8mm wooden cubes in Europe and China. Turns out that wood in China is at least 25% cheaper than in Europe.

Cost comparison

So, my choice of games would exclude games with any sort of fancy pieces, like Teotihuacan: City of Gods, Tekhenu: Obelisk of the Sun, Origins: First Builders, or Tabannusi: Builders of Ur. But fortunately not all games made by Board&Dice cross that threshold, so my weapon of choice is Founders of Teotihuacan, a game that we will release next year, but which has been in the works for the past 2 years.

In the spring of 2021 (which now seems like a lifetime ago), when shipping from China had first become a nuisance (and has since turned into an actual nigthmare), we though of it as an opportunity to bring production closer to home, namely in Europe. We had manufactured games in Europe in the past (2012-2015)and the quality was OK-ish, costs were in the acceptable range, and since then more factories have appeared. My colleagues and I reached out to 11 factories which were not located in Asia: most from Poland, but also from Germany, the Netherlands, France, and Czech Republic. We have heard back from many of them (but not all) and instead of telling you a story, let's have a look at the actual offers (with any potentially sensitive data being blurred). I won't even show the most ridiculous one for almost $30 a piece, but the rest are from serious, established factories:

From gallery of anovac


And then the same factory - a revised offer:

From gallery of anovac


And more offers...

From gallery of anovac


From gallery of anovac


From gallery of anovac


From gallery of anovac


Now, these are simple facts and I do not intend to shame anyone by publicly showing these prices. This is just a piece of the reality we (board game publishers) are living in. Now, let's have a look at a single offer from China, which is NOT the cheapest by far, but it does provide the guarantee of quality:

From gallery of anovac


So, a quick summary:
- best offer from Europe is for $6.83 vs 4.73 in China
- at shipping prices from the spring, the average cost to ship from China to all destinations was $1.85, and from Europe, $1.15
- the factory in China could produce exactly as we wanted the game to look like, producing in Europe would require some compromise on our side
- in Europe we'd have to choose the lowest price, and accept a longer lead time (by 30 days)

And this is the price story of one of the simples possible games. The differences grow deeper with every components that is not strictly made of paper or cardboard, and it can get sky high.

I won't go to conclusions just yet, as there are a few more key aspects.

Supply chain

Some weeks ago, in the summer, I had the chance to chat with a few friends from the industry, and we shared stories. I was, of course, complaining about shipping from China, whereas they had some different issues, funny ones when you look from the outside. One of the bigger factories in Poland had run out of cardboard, effectively delaying all board games in their production pipeline by 1-3 months. They were smaller and thus among the unlucky ones. Another had a contract with a different factory which post signing increase the price with a significant amount, as raw materials became more expensive. And there's a third one whose games got both delayed and more expensive.

This things happen not because the manufacturers in Europe are evil - in fact almost everyone I've met was an amazing person, and I loved working with them - it is simply their effort to remain in business. A lot of the raw materials are made in China, and the same issues that affects us also affect them, just in their case this is opaque for the publishers who are their customers. Chinese manufacturers sometime also source materials from other parts of the world (e.g. plastic foil from Middle East, linen paper from Germany) but pricing for shipping into China is quite decent. Some of the Chinese manufacturers are also quite big, and potentially richer, thus able to create stock of raw materials to cover more than their immediate needs. More importantly, they source a majority of raw materials from less than 1000 km away.

But, in my opinion, this is not the end of the story.

Technology

I must admit that the last time I stepped into a factory in Europe was 5 years ago, so I may not have the exact latest information. Here is how things looked back then...

The factories I visited operated in fairly new buildings, offering good working conditions to their employees, but the technology I have seen was already old-ish. A lot of the processes were manual or semi-automated. Moreover, the actual print (done on an offset printer such as Heidelberg Cx104) was outsourced to a subcontractor, as having a printer of that size (and this is a big-ass monster) and not using it all the time would not justify the investment. Around the same time, I also visited 8 factories in China. The top 3 factories that I've seen had state of the art technology and good working conditions.

Is technology the main advantage of Chinese factories? I cannot answer that with a fair degree of certainty, but it feels like that's relevant, because salaries are similar between Shanghai (where most factories I've seen are located) and Eastern Europe.

Technology allows us - publishers - good choices. In China we can actually produce the board games that we imagine, with needed plastic inserts, fancy wooden pieces, plastic miniatures, and even crazier stuff. Can you imagine 7 Wonders with all the components lying in the box flat, no insert? For me, as a young(er) gamer, that fairly basic but useful insert made an impression. Or Lords of Hellas without the miniatures? Or Teotihuacan: City of Gods without the fancy pyramid tiles?

What about producing in North America

The reason I did not mention any factory from USA or Canada is that I do not know of any that can make a modern board game. There is a list that some kind soul shared at some point (sadly I do not remember who) with almost all relevant game manufacturers in the world:
https://boardgamemanufacturers.info/

I know of a few board games with a "proudly made in the USA" big logo on their boxes (like Roll for the Galaxy). I suspect that board game is not made in its entirety in the US, but since I have no ties to the original publisher, I cannot confirm that theory. But I do know of another game featuring a similar quote on its box which should in fact say "assembled in the USA".

We do care about the environment and we'd love to be able to ship less in general. A game only assembled locally reduces its footprint only in part, IMO not justifying the increase in cost.

Conclusions

In the present, it is not realistically possible to make more than simple* board and card games in Europe, and almost nothing beyond Monopoly level in North America, while offering competitive prices. For example, Tawantinsuyu: The Inca Empire would have to have a price point of $80 if we made it in Europe. Teotihuacan: City of Gods would be almost $90 in the same conditions. The offer from China for Founders of Teotihuacan allowed us an amazing choice: have a decent margin, or introduce a few fancier components, or a bit of both - which is what we did.

(*) Simple does not mean a light game, or a game with just cards or a few tokens. It means that it does not have heavily customized wood, or printed wood, or a fancy insert, or miniatures.

As long as our industry follows current trends, with more customized components, and games looking far better than a decade ago, and with rather tight margins, manufacturing will mainly remain in Asia, simply because no one is ready to accept much higher prices for their favorite games. At the same time, European factories can still produce at full speed card games and simpler board games, being as busy as they can handle.

I would love to hear someone prove me wrong, to see an example of a complex board game made entirely in Europe or North America, close to its final customers. We would immediately try to follow suit: we could still serve Asia from China, we would like to also produce in Poland or Germany or Romania for the European market, and to print in US or Canada as well. So, if you know of any such possibility please share!
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