Sunday, July 22, 2007

Shock & Awe vs. Natural Selection

When it comes to game store inventories, I see two major approaches: Shock & Awe and Natural Selection. There's a third type called Total Chaos, but I don't need to explain to you what that looks like.

Shock & Awe. This is the game store that seems to have everything. It's an old-fashioned way of running a store, or possibly an intentional method if there's little competition. You stock full lines of products; every Rio Grande game, every Warhammer 40k item, everything that a customer could want. This is a "pull" approach to inventory management. You have the stuff, you wait for the customer to come in and get the stuff. It's all there for the taking.

Fewer stores still use Shock & Awe because it's expensive. You're likely stocking items that sell once per year or even less often. You're really making a marketing statement, saying that you have EVERYTHING. No need to go elsewhere. Shock & Awe. From a retailer perspective you might have a quarter million dollars in inventory and you might sell through that inventory twice each year ($500,000 in sales or a turn of "2"). My guess is that most Shock & Awe stores don't even calculate turns. They don't care. The ideal store is a Shock & Awe store that has some "push" elements, AKA a knowledgeable sales person who can guide you to the cream of the crop while offering and being knowledgeable about all other options. The store that best exemplifies this is my favorite game store, Gamescape San Rafael in San Rafael, California.

Natural Selection. This method uses intensive inventory management techniques. It requires that the manager carefully control inventory and to prune out items that under perform. You don't stock all of Rio Grande, just the top 15 games that sell well. Maybe you order in a couple slow sellers that you rotate through over the year, like crop rotation. You might stock full lines of products like Dungeons & Dragons, but you carefully prune out items from even your most popular games. From a retailers perspective, you might have $125,000 in inventory, but because of your inventory management skills, you sell through that inventory four times a year ($500,000 in sales or a turn rate of 4). Your very efficient with your dollars, but your customers aren't quite as happy. In this scenario, it's very important to "push" the products you have, to showcase the games that are popular in your area, and to be very aware of your customer likes and dislikes, the games they're waiting for or don't care about. It's up to you to tailor your store to the local demands. That's the requirement of Natural Selection. I try to run my store like that. It can sometimes be a mercenary process and customers aren't always happy, especially new ones that wander in expecting an obscure book that nobody seems to play locally.

Both models are valid. Both require on-the-ball sales people and management to run properly. There are local "Shock & Awe" stores that have bad service, and the benefit they gain from their strategy is diminished because of it. Poorly run stores with "Natural Selection" fail very quickly, as their unable to put their finger on the pulse of their customer base. Customers will always appreciate more inventory in a store, but they won't necessarily buy more if it, just because it's there.


  1. "The store that best exemplifies this is my favorite game store, Gamescape San Rafael in San Rafael, California."

    Didn't you mean "second favorite game store"?

    best -


  2. Of course. My own store is like my own child. It's hard to even compare it to others, so I generally don't.