Why I refuse to support my FLGS

[KaosDevice]

Something that many people don't often realize is that a simple 10% discount to a FLGS owner is a much bigger hit to the profit margin than one would expect.

Makes sense. My LGS has a percentage amount off comics for subscribers but other products they have the whole punch card thing , where you can get $x for your card off what ever with subsequent cards being worth more $x. That might be a little kinder on the stores then a flat %.

 

[Dannyalcatraz]

So much to respond to...

Dannyalcatraz
Heck, when I started gaming, (in Denver) I had to go into a Hobby Shop (you know...trains, planes, slot cars).

MoogleEmpMog
I'm surprised you had trouble finding a game store in Denver! How long ago was this?

1977.

Back then, to get to a game store, we kids had to hypnotize our parents to drive across town in the daily blizzard, up into the Rockies past the dreaded Flying SpiderGators to get to a game store.

...and we LIKED it that way!

My FLGS is packed every weekend with Magic players and Pokemon. I'm certain that helps things out a lot

Actually, yes. First, it is a product that sells- that pays bills. There are stores where CCG's account for 60%+ of annual gross income. Second, the longer a person stays in the store, the more they tend to buy. (Read Why We Buy, by Paco Underhill.)

As does the high price of GW stuff.

GW, at least in Dallas/Fort Worth, cut its own throat. They raised prices to LGS's, then opened a store in the less-than conveniently located Grapevine Mills Mall that undercut those prices. Many LGS's in the region responded by discounting GW and ceasing re-orders. That GW store is now gone, and GW product is slowly filtering back into the other LGS's.

I just don't think Wal-Mart is going to carry Burning Wheel, or CoC, for that matter.

It could be worse than that. Wal-Mart and other discounters often invoke "morality clauses" on products they sell (take a look at their music section- you'll find a lot of edited CDs and others they simply won't sell). As a result, if Wal-Mart or its counterpart drives your LGS out of business, you might not have a choice in whether to shop online. And how many big box stores sell game support products (minis, paints, mats, RPG-specific software)?

And if the big boys are the ONLY players in the game (and here I include the online stores like Amazon), you may find that the only way to find unedited gaming material is to purchase directly from the publishers and manufacturers.

I don't remember who said it, but it is unlikely that game companies get paid the same amount of money per unit sold regardless of retailer. Simply put, the big guys can negotiate prices that little guys can't.

Recently, a news expose report revealed that Wal-Mart paid a particular 3rd world clothing manufacturer a price of about 5¢ above costs. In order to maintain compliance with Western workplace rules, the manufacturer asked for a 1¢/unit increase from Wal-Mart...and was rewarded with a 2¢/unit decrease.

Furthermore, some sales contracts (especially with the big retailers) are structured so that how much manufacturers get paid depends on what % of full price the product sells for or through which distribution channel the product is sold (online vs in-store). So, if the big store discounts the RPG product to predatory levels (let's say, 20% below their cost) while cross-subsidizing it with slightly increased prices on their tires, the retailer will still keep its full profit margin, but the RPG's producer may get only 70-80% of their costs. The retailer loses NOTHING while the RPG producer gets exposure around the world...and loses money per unit. For the short run, that's OK- that can come out of the advertising budget- but long run...

See, this is why I'm glad our FLGS - Dragon's Lair, in Austin and Round Rock - does everything right.

Dragon's Lair was a personal favorite of mine when I was in Austin- a truly great shop. And, while I'm not positive, despite its being in a converted house (like all the other businesses in the area), I doubt that the owner actually owns it.

 

[woodelf]

Does anyone else think the coffee at B&N (and Starbucks in general) tastes burned? I remember as a teen, my parents sent coffee back if it tasted like that in a truckstop. Now you add some floofy steamed milk and it costs four times more...

Three anecdotal data points:
Everyone i know, personally, who is a coffee drinker thinks that Starbucks is the worst coffeeshop coffee in town. (Though they disagree mightily on what is the best.)
I had some friends who were from Seattle, right around the time that Starbucks was really making a national splash. They commented on the irony of it being known as "quality NW coffee" in the rest of the country, because back home (i.e., Seattle), it was considered the worst of the coffee shops.
Near campus, the Starbucks seems to be patronized exclusively by East-Coasters/New-Englanders, while the locals go to the local places, predominantly. I always assumed, in concert with the above points, that this was because the East-Coasters were going somewhere familiar, rather than shopping around to see if one of the unfamiliar local places was better.

 

[farscapesg1]

Services and friendliness are nice, but they don't make up for all the price differences though.

I'm not familiar enough with the whole gaming/hobby shop business so I have to make some comparisons to something that I am familiar with, computers

If you look at computer shops, you would think that there are a lot of them, but pay attention to how many of them come and go. With big chain stores like Best Buy and Circuit City, and the companies selling directly like Dell, it is harder and harder to run a computer shop. I know several of the local computer shop owners and in fact wanted to start one myself until they showed me the error of my ways. The majority of their income comes from upgrade and repair services, but these have been dropping off drastically thanks to Best Buy's Geek Squad and similar big chain support. The general population doesn't understand that their Dell or Compaq system has an inferior video card, are usually sold with a very minimum amount of memory, and usually have other sub-standard components. Of course, you tell them and the only thing they care is that they got the computer for $300 after rebates :\ There is no way that a "mom and pop" shop can make a profit off of a $300 computer.

I guess what I am trying to say is that while I love a good LGS (if you can find one), until the general population stop buying from large retailers (and are willing to pay more to do that), Amazon, B&N, Walmart, etc. will recieve more of the business and the LGS will go the way of the neighborhood bookstore (one of the things I sorely miss from my childhood years).

 

[scourger]

I think I'll keep bugging my FLGS for Tour of Darkness rather than ordering it online as I could have for the past 6 weeks.

 

[Prince of Happiness]

Sometimes I wonder if Seattle does indeed exist in another universe. It's funny, because Seattle is a retail environment that has been quite conducive to the small mom/pop type shop, if they do offer excellent service and niche product...and not only that, thrive and expand (this is especially true in the independent music stores in the area) to become small chains in their own right. Yeah, we have a Starbucks on every block (sometimes two or three downtown), but we also have a butt-load of smaller places. We have Barnes & Noble and Borders and other "big box" stores, but there's still the small shops around as well. I don't mind that it works out that way, and I'm really fine with it. It's like the 3E mantra "options, not restrictions."

While I haven't found a gaming store that's been anywhere near the pristine, holy experience that other posters have written about. To that end I've ended up becoming rather pragmatic about where I spend my gaming dollars if one place has a book I happen to be at, fine I'll get it there. If it's cheaper online and I can wait, I'll order it online. If I need some type of accessory (or a "German" boardgame) I usually hit up Gary's Games because they carry that kind of stuff and have a pretty good used section. On the other hand, it reeks to the Heavens and the Hells.

Again, if there is that good combination of knowledge, know-how, selection, infrastructure (game rooms, parking), hygiene and location it would do alright. Hell, with "industry names" in the area you could even have pretty regular events ("Hey kids! Get your Monster Manual signed by such-and-such!" or "See art from such-and-such artist/illustrator and buy prints or originals!" or "Whine to Erik Mona about why stat block on p.xx in Dungeon 120 is wrong! Today! In-store!" "Orc and Pie Night!")*. Why a gaming store in this area hasn't quite grasped that yet, I dunno.

Soooooo nope, no dedicated, hard-core loyalty from me. Haven't had the incentive to do so.

*Again with the local indie record shops: Recording artists do free in-store shows All. The. F'n. Time.

 

[Nellisir]

See, this is why I'm glad our FLGS - Dragon's Lair, in Austin and Round Rock - does everything right. Don't care about your income? *bzzt* The Lair's owner - not a salesman, but the owner - offered me a tidy sum for some out-of-print games when I desperately needed the cash for things like bills and food. Won't special order or stock products aside from limited game companies? *bzzt!* The Lair stocks everything under the sun...and f they don't have it, they'll special order it and call you when it comes in.

I'm just amazed at the vitriol that gets slung at game stores - because the one near me is near perfect. Lots of game space, friendly staff, clean, knowledgeable about everything from anime to toys to traditional board games to comics to RPGs. They have a subscription service. They make recommedations, they recognize each and every one of their customers (hundreds of faces, at least). That a game store wouldn't do this boggles my mind..

See, I know a gaming store like that...but it's not my FLGS. My FLGS only orders stuff when the total order (mine & others non-comic material) is over $400, because that's when her free shipping kicks in. So I've had to wait over a month (after it was released and available at Borders down the street) for a product. Discount? Uh-uh. The OTHER (not local) GS gives me 30% off pre-paid preorders for being a "member" (which is free), 25% or 20% off of preorders, and 10% or so off of whatever I feel like. There's a third store that'll give me $10 in merchandise after I buy $100 in merchandise, but I have to pay $20 or so a year for the privilege.

I buy comics from my FLGS, but gaming material? No way.

 

[Some guy from Ohio]

My apologies. I used your post to rant on what I feel I have seen in others.

No fault, no foul.... but thanks anyway.

 

[Dannyalcatraz]

Oh yeah...forgot to talk about the discount programs.

Discount programs, especially coupons and punch-cards variants, are better for retaliler than regular discount programs because there is an element of variability of usage introduced.

Example: a flat 10% discount to favorite customers draws those customers back, and discounts the usual sales tax and cuts into profits a little bit...but it gets covered by increased sales volume. The gamer saves $10 per $100 spent.

A coupon or punch-card program does the same thing almost as well (statisically) as a 10% discount in drawing return customers. However, instead of costing 10% each sale, it only costs that 10% when it gets used, and people will forget their coupons or punch cards a certain % of the time. Instead of saving $10 per 100 spent, he may spend $150 before saving his $10. The stated level of the discount differs from the effective level of discount...for a statistically insignificant loss in volume of sales (a fraction of a percent, on average).

Punch card programs that don't work are usually run poorly- customers get multiple punches for the same purchase (sometimes because a pal in the store hooks 'em up- which is embezzlement), or the card isn't confiscated when the discount is earned...and in some cases, the punches get counterfieted.

 

[jgbrowning]

Oh yeah...forgot to talk about the discount programs.

Discount programs, especially coupons and punch-cards variants, are better for retaliler than regular discount programs because there is an element of variability of usage introduced.

Example: a flat 10% discount to favorite customers draws those customers back, and discounts the usual sales tax and cuts into profits a little bit...but it gets covered by increased sales volume. The gamer saves $10 per $100 spent.

This was the point I was trying to make earlier. Sales volume may have to (worse case) increase by 1/2 under a 10% discount program in order to just match normal sales at non-discount prices. Best case, a retailer has to sell someone 1/3 more product at 10% discount to equal a normal sale at non-discount prices. You have to look at the profit margin %s not the straight MSRP %s.

A 10% discount MSRP can easily translate into profits being reduced by 33% for a retailer.

To use your $10 every $100. The reailer is (at best) making $30 profit (after expenses) per every $100 MSPR sold. By giving back $10 to the consumer, the retailer has just lost 33% of their profit and would have to sell (at normal prices) an additional $33 MSRP to make up for the profit lost to discounting. Asking for a 10% discount is often just like asking the FLGS owner to make 1/3 less money. In industries with markups much higher, like 100-500%, retailers can afford to discount heavier, since their profit margins are not nearly as tight as FLGS's. Unfortunately, gaming isn't a such a business.

joe b.

EDIT: as of 37 FLGS owners, 5 own their own store, while 32 are renting.