Distribution in New Zealand

[JBowtie]

I've been talking to my FLGS, and discovered that their distributor is WOTC. There don't appear to be any other distributors offering service in NZ, and as far as I know there are only 4 FLGS in the country.

The issue, of course, is that only a handful of non-WOTC material is available (mostly a random assortment of SSS and non-d20 books), availability is spotty at best (no new stock in the last two months, no PHB, DMG, or MM in the last shipment), no products showcased or even available at conventions (there are at least three annual local cons), and isane prices because everything is shipped from the US to Australia to NZ. The average $30 book is NZ$82; given the exchange rate it should only be around NZ$55.

To address this, I'm considering starting my own distribution company. I'd certainly be willing to consider working with someone who's already established, since it would save me a lot of work.

While I research the legal side here (starting a company, importation/product ratings/customs issues), I'm interested in getting publisher feedback - are there existing roadblocks like exclusive contracts with big distributors? Would some of you consider printing locally to save on shipping costs? Do you have minimum order sizes? What kind of legal assurances do you need before working with a distributor? Can I push your stuff at conventions?

If you'd prefer to drop me a private email for any reason, you can do so at jbowtie@amathaine.com; I'll eventually summarize the feedback and post it here.

John C Barstow
*Extremely* frustrated gamer

 

[JohnNephew]

Years ago we had a couple of New Zealand distributors. I think they went out of business in the first great CCG crash (the 1995/1996 period).

I am, unfortunately, dubious about how viable a game distributor for New Zealand would be. Even one of our Australian distributors no longer buys directly from us, but rather purchases from a US distributor (at the same prices that US retailers pay), and then re-sales (with a markup) to Australian customers (and probably New Zealand as well). While the cost of goods is higher, it is apparently still cheaper than arranging shipping and consolidation when buying direct from individual manufacturers.

Still, here are replies to your questions:

> are there existing roadblocks like exclusive contracts with big
> distributors?

Rarely. Some manufacturers do exclusives in some countries, but in general manufacturers don't like it, since it stifles competition. Some manufacturers themselves face limitations on where they are allowed to sell various items (licensed goods, for example, where a licensing agreement may limit their sales territory -- say, trading card games based on TV Show X, which may only be marketed in North America).

> Would some of you consider printing locally to save on shipping
> costs?

No. Any shipping cost savings would be more than offset by the higher unit costs of printing a small run over there. If there was enough demand to make a print run economical, the same volume would make shipping and related costs dramatically lower as well.

> Do you have minimum order sizes?

Yes. It varies by manufacturer. Some have a minimum of a number of units, others have a minimum dollar figure.

> What kind of legal assurances do you need before working with
> a distributor?

Most manufacturers will want some kind of demonstration that you actually are a distributor re-selling to stores, legally established as a business, etc. This may put you in a chicken-and-egg situation (manufacturers won't sign you up until you have customers; customers won't sign up until you have manufacturers whose goods you can sell them).

> Can I push your stuff at conventions?

Most likely. Manufacturers are not likely to appreciate it if you are selling at a discount, however (compared to what other retailers can afford to sell for -- in other words, taking advantage of the discount you're being given that is designed to allow you to re-sell to stores who in turn need a good markup before selling to the public).

 

[sotterraneo]

I've been talking to my FLGS, and discovered that their distributor is WOTC. There don't appear to be any other distributors offering service in NZ, and as far as I know there are only 4 FLGS in the country.

The issue, of course, is that only a handful of non-WOTC material is available (mostly a random assortment of SSS and non-d20 books), availability is spotty at best (no new stock in the last two months, no PHB, DMG, or MM in the last shipment), no products showcased or even available at conventions (there are at least three annual local cons), and isane prices because everything is shipped from the US to Australia to NZ. The average $30 book is NZ$82; given the exchange rate it should only be around NZ$55.

I'm not a publisher, just a retailer from the other side of the world (quite literally...) but I hope my comments may give you some useful ideas.

In my opinion the best move for starting a local distribution company in a situation like yours, judging from a retailer's perspective, is signing up with the Alliance/Diamond conglomerate and open an account with them. This will let you able to buy products from a lot of publishers and receiving the goods together, so saving quite some money if compared to receiving many expeditions from many US publishers (not to mention customes duties and red tape!). More, a shipment from, let's say, 20 or 30 publishers is big enough to perhaps justify shipping expenses, even if you import just two or three copies of various titles.

The big question is that if there are just three or four stores in New Zealand, perhaps all the expenses associated with setting up a company couldn' be justified: I don't know what exactly are the expenses ofr running a business there, but you have to consider, these are random examples, start up expenses, pension contributions, taxes, import duties, paying for an accountant and the expense of a place where stocking the goods for example.

You could in my eyes perhaps do better becoming an online retailer after signing up with Alliance/Diamond. You have to register a company for various clear reasons, but some costs (for example a warehouse or something similar) may be avoided. More, you can sell direct to customers and so get a bigger return (and you will learn why D&D books are so 'costly' there). More, you can always beat the convention circuit to gather customers, keeping them informed via e-mail.

I have a supplier of mine using exactly this strategy. The real market here is for the sale of Italian edition of various games - for example 25 Edition has the D&D III and Vampire license, Nexus Editrice LotR CCG and Wizkids Games license, Hasbro has of course everything Wizards etc. There is a small company having the 'official distribution' for original material from various big US publishers such as White Wolf, Steve Jackson Games and so on. But they target a niche market, fans of original (English) material, and their 'exclusive' doesn't stop Alliance/Diamond from selling their wares to others, including this supplier of mine.

He has set up a website detailing carefully all its offers and services, with a certain discount of compared with regular store prices. Mind you, I'm the first to consider Internet retailers an enemy due to their obscene discounts (no wonder so many of them sink after a year of two) and the fact they 'prey' on existing customers without adding nothing to the customers' numbers, but after discussing at lenght with him and pointing the fact that a retailer will never, ever do business with a company desiring to destroy his business, he decided to lower its discounts for Italian language material, focusing on English material: this is such a niche market that this thing doesn't really bothers me or my colleagues.

He seems going quite well and it has reached a number of retailers with his services. Beyond understanding that you can't be both a supplier of retailers and a competitor of them, he knows well the products, doesn't have problems in ordering ?esoteric' (meaning as 'non mainstream') and albeit his administration skills need to be sharpened a little he is reasonably efficient. I suppose you can do the same.