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Subject: FLGS and MSRP rss

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Mike Petty
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This has probably been discussed, but I didn't see anything recent about it specifically.

For the first time in years we have several places within an hour driving distance that sell games I'd actually pay for. Comic shops especially are cropping up or stocking up on more good games. The problem is, every one of them keeps the games at MSRP indefinitely. I've seen some sales around the holidays, but the small discounts don't seem to move the less popular, expensive titles.

So, I'm wondering if this is typical for small comic or game shops.

Also, am I crazy that it seems to make no business sense? I have never run a store, so maybe I'm missing something. When I see a game sit on the shelf for a year, though, doesn't it make sense to lower the price over time?

We see tons games come out and most eventually gravitate toward a rating on BGG between 6 and 7. They show up in the big online sales around 50% MSRP. They're not popular in general (and certainly not in my area where these stores in question are located). I'd say they're simply not worth what the publishers and the retailers hoped they'd be, so isn't it better to sell them for less (maybe considerably less) rather than not sell them?

I'd love to support the local stores, but it's too the point where most have the same games they did six months ago because the prices are so high.

 
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Moray Johnson
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mpetty31 wrote:
This has probably been discussed

Yep, only about every other week or so. whistle
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Jacob
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There has been much research done about this, but in general, selling your games for 10% less than MSRP means you need to sell SUBSTANTIALLY more copies. I've been reading Game Retailer's Guide by Lloyd Brown, and the numbers are broken down in there, so unfortunately I can't link it to you. I'm sure you could find math examples online with little

So, to answer your question, "doesn't it make sense to lower the price over time?", the answer is no, not usually.

I guess maybe if it's really old product that you just want to move, never to restock again, but in general no. Not if you want to make money.
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Derry Salewski
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Yes it's typical.

It's just what they have to do to make money.

I . . . don't quite get it either. I kind of feel like you do. But also, why bother? Online stores sell everything you need and local stores can never compete on price with tax included.

I don't own a business so it SEEMS like the math says "if something isn't selling, get rid of it and cost and call it a day" but really it's supposedly more complicated!

It's like, their plan is to sell their main product to regulars and to sell addons at a good, profitable markup to whoever wants them, whenever that happens to be. They don't really care if a game sits on a shelf or not. If they sell it to you and make two dollars profit, they just have to spend 20-30 bucks on a new game to fill it's space.

It's VERY unlikely that selling boardgames is their core business plan (aas you noted, its a lot of comic/magic/hobby type places.)
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Patrick Simmons
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I've noticed the same issue in certain stores in my area (though I also am lucky enough to have at least one shop fairly close by that actually offers pretty good discounts on a lot of games), and it has always bothered me to a small degree: I want to support my FLGS, but I'm also, y'know, cheap - so I gravitate towards buying games online where I can generally find better prices.

On the other hand, not running one of these stores myself, I can't imagine many of them purchase their games at a price that allows them to do much in the way of discounts while still turning a profit (enough to stay in business), or, I would assume, more would be doing so (discounting, that is).

What bothers me more is that the closest store to me usually has some used games around, and these tend to be priced so poorly I can't imagine why anyone would buy them (case in point: Munchkin 2: Unnatural Axe, can be picked up brand-new on Amazon for around 15 bucks - about $5 less than MSRP - at my FLGS a used copy of this - in a bag, no original box, and missing any instructions - has been for sale at $17-18 for about two years now).

In terms of new games, I'm sure profitability comes in somewhere, but for used games, a lot of FLGS prices seem just absurd to me.
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Mike Petty
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Thanks for the thoughts.

I should add that I'm not expecting them to regularly price games below retail price on all or even some of their games. I've paid full price for games in these stores when I know I could get them online cheaper, just because I like the other benefits of having a game store nearby.

This was more about games that time has proven are not going to be best sellers, reprinted, etc.
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Bryan Thunkd
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mpetty31 wrote:
but the small discounts don't seem to move the less popular, expensive titles.
Your FLGS isn't making much money on board games... they'll probably lose money if they mark it down much more. The problem is that they shouldn't have stocked this game in the first place. They'd be better off sticking to big hits and low pricepoint games that they can turn over easily.

mpetty31 wrote:
Also, am I crazy that it seems to make no business sense? I have never run a store, so maybe I'm missing something. When I see a game sit on the shelf for a year, though, doesn't it make sense to lower the price over time?
Yes... but if they sell it and make nothing on it, then they've got to fill the shelf with some other game. And they're just as likely to pick another dud. Most of these stores are making their money on CCG's, comics, or something other than board games. It's not like this is a single item that isn't selling well... it's probably the majority of their board game section isn't selling well.

Quite frankly, they probably can't support their store on board games alone. The people who are casually into boardgames can find the more popular stuff at Target or Barnes & Nobles now at about the same price a FLGS can afford to sell it for. And the people who are really into board games can get all the games online cheaper. A FLGS just doesn't have the business model to compete with the pricing of an online retailer.

It seems that many of these stores throw out a board game section just to say they have one and hope that somebody will occasionally buy a game at full MSRP. And in the meantime they pay the bills by selling Magic and comics.
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Ashley Kennedy
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I think it depends on the approach of the FLGS owner/staff. There are different viable approaches that lead to particular environments.

The dry stuffy stock at MSRP that you are describing at many game/comic stores seems to work on the fixed profit margin that they could EVENTUALLY receive from the stock at MSRP. This is not aiming toward the Alpha gamer, BGG user market but at the casual market. The person who decides to walk in on a whim and might be interested in the game. (If so though, they should at least dust the stock now and then blush

My FLGS Dicehead Games in Cleveland, TN tends to aim towards a rotating stock. The owner keeps the evergreen titles in the store (Settlers, Dominion, TableTop selections), but also keeps fresh game selections available and changing on a regular basis. This also includes the other genres of material that he keeps in stock. They also regularly place items on reduced price to clear the stock and make room for newer titles that might generate more buzz. He is however a very active and knowledgeable owner about the current state of all of his relevant markets (Comics, Magic, Boardgames, GW, Miniatures, etc.).

For this reason, I go out of my way to purchase through his store when possible, and he recognizes customer loyalty with discounts that will AT MINIMUM cover tax. I have bought store copies of games I want that are fading out of rotation with the store at great discounts too.

Basically to say, sorry your store isn't creating the energy of an active and rotating stock. It may not always make as much financial sense, but why return to a store when you know they will just have the same games.
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Nick
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I don't have a problem with brick and mortars selling at MSRP; I do have a problem with them selling ABOVE MSRP.

There's a certain "beloved" store in town that likes to jack the MSRP on stuff that hasn't had a wide release or goes low in stock rather quickly or in one case, on speculation that stock was going to be low.

For instance at this store, "Flick 'Em Up" was $85, the new Magic game was $45, and initially a Justice League Dice Masters starter was $25.

I figured it was standard practice, but soon noticed the same games briefly in stock at other local stores for MSRP.
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La Donn Wittenburg
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The one thing you're forgetting is a store buys a game generally from a distributor. They pay a certain price based on the number of copies/total volume they purchase from them. So lets do some math.

Lets take a standard game that has a MSRP of $59.99.

Online that game can typically be purchases for around $39.99.

Now depending on the game that game costs between 9-15 to produce. Shipping for the publisher costs roughly another 3-5 to get it from the printer to the distributor making the cost around 12-20. This copy then has a markup and depending on volume purchased is sold between 22-28 a copy to the store. Possibly more if they buy very few products. Depending on the volume they may need to also pay a price for shipping. So lets say in the end their cost is between 30-35 for that game.

They now have to dedicate shelf space to it which becomes part of overhead cost. The longer the game sits there the more income it's costing them so the cost goes up. If they sell 2-3 copies of that game a year at MSRP they make $25-30 per copy. If they drop the price 10% so down to 54 per copy this changes their profit to $19-24 per copy. This reduced *might* get them an extra copy or two sold a year. This in turn might increase their local sales based on people learning that there is a lower price at that store.

The sad truth is because local store pricing is generally at MSRP the majority of purchases are probably made online. I'm generalizing here based on my buying habits here. I used to make most of my purchases at the FLGS this has changed to 80% from online, 2-3% local, and the other 17-18% used. As the volume of my purchases increased I started to look for better pricing as it was no longer spending just an extra $10-20 a week on a game. It became an extra 200-300 a month if I made all of my purchases locally.

So in the end most stores derive most of their business from quick sales items. Example CCG, common games that most gamers wouldn't play, and other items in their stores. If they get a sale from a boardgame its a bonus because most buyers continue to purchase online once they get used to it.

If there was a local store that sold for the same price as CSI I would probably check them out but in the end unless I spent time in that store I would probably shop online to avoid paying tax if the prices were the same.
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mpetty31 wrote:
This has probably been discussed, but I didn't see anything recent about it specifically.
fwiw there's there nice new thing called a search engine

https://www.google.com/search?q=FLGS+and+MSRP&oq=FLGS+and+MS...

ymmv
 
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Tina McDuffie
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Thunkd wrote:
The problem is that they shouldn't have stocked this game in the first place. They'd be better off sticking to big hits and low pricepoint games that they can turn over easily.

If only there was a magic crystal ball that showed what games would be the big hits before they became big hits and were still available for preorder. :-)
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Bryan Thunkd
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tgmcduff wrote:
Thunkd wrote:
The problem is that they shouldn't have stocked this game in the first place. They'd be better off sticking to big hits and low pricepoint games that they can turn over easily.

If only there was a magic crystal ball that showed what games would be the big hits before they became big hits and were still available for preorder. :-)
You mean like how everyone at Gencon was raving about Codenames? If I was a store owner, I'd be keeping my ear to that ground and would have put in an order as soon as I heard that. There's any number of game conventions that feature new and upcoming games and from which there is buzz about new hit games.
 
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Mike Petty
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Thanks for the thoughts on this. From what I'm reading, could we sum it up this way?

It's not realistic to expect games to be regularly discounted at a small game store or comic shop.

The best way store owners can avoid shelves full of games that aren't selling is to purchase wisely.

It's not a bad idea (and not unheard of in some places) to sell games at a discount (possibly a deep discount) when they've been sitting on the shelf a long time.

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Isaac Finkelstein
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Good stores manage inventory well, maintain a high turn rate, and discount and discontinue poor sellers.

Bad stores are haphazard about it, keep every game on the shelf until it sells at full price, and turn into dusty game museums until they go out of business.

There's a great blog that speaks about game store tradecraft including inventory management and turns quite frequently:

http://blackdiamondgames.blogspot.com/search?q=inventory
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Tina McDuffie
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Thunkd wrote:
tgmcduff wrote:
Thunkd wrote:
The problem is that they shouldn't have stocked this game in the first place. They'd be better off sticking to big hits and low pricepoint games that they can turn over easily.

If only there was a magic crystal ball that showed what games would be the big hits before they became big hits and were still available for preorder. :-)
You mean like how everyone at Gencon was raving about Codenames? If I was a store owner, I'd be keeping my ear to that ground and would have put in an order as soon as I heard that. There's any number of game conventions that feature new and upcoming games and from which there is buzz about new hit games.

Just because it's a big hit at Gen Con, Essen, insert con here, doesn't mean it's going to be a good seller. There are no guarantees. I agree that paying attention to what's hot is helpful. Constant research is essential, but it still doesn't guarantee a sale. It's more like betting on a horse race. You research the horse, you research the jockey, but you really don't know who's gonna win until the race is over. Hence the desire for a magic crystal ball.

There are certainly evergreens, but they take some time to prove themselves evergreens. However, what's evergreen in one store is not necessarily evergreen in another. Also, store owners often lose sales when their evergreen goes out of stock at the publisher. There's not much you can do about that. It's a tough business.
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Ben Corbett
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Bimm wrote:

Bad stores are haphazard about it, keep every game on the shelf until it sells at full price, and turn into dusty game museums until they go out of business.

http://blackdiamondgames.blogspot.com/search?q=inventory

This is my local store in a nutshell. I think the only way they are still open is this guy must have a trust fund or something. I never see anybody in there buy anything. Their entire inventory is to the point now that games just sit on the floor with prices 2 times higher than CSI.
 
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