Wednesday, November 26, 2014

The Dreaded Friday the Black (Tradecraft)

A lot of what we do in our specialty retail business has little resemblance to mass market retail. Black Friday is an example of that. The term was originally coined to describe dense traffic in the downtown Philadelphia streets the day after Thanksgiving. However, we know it more for the popular folklore of retailers finally getting out of the red from flagging sales January through November, and breaking into the black (profitability).

This may have been true at one time, especially with the ascendancy of mall stores (which are now mostly sad tombs to consumerism), but for most specialty retailers, the holidays are big, but aren't critical. Our season is Summer, while the month of December is our best month, one that usually erases past or future sins (like the tax bill or the store fixture tab). Stores in college towns see a reverse pattern, but this is generally true. So what about this dreaded Black Friday?

30% of people will be done with their holiday shopping by the end of this weekend. Some will be done before Thanksgiving and the rest will be done shortly thereafter. I just finished mine, since as a retailer, I have no time for retail shenanigans, and thankfully, many Black Friday sales start the week of Thanksgiving.

So what are our options with this 30%? We can be above it all, and turn our noses up at nearly a third of American consumers, who will do all their shopping, before you can finish digesting your turkey, or we can find a way to engage.

Engaging, first of all, needs to be respectful of our employees and their families.  We're closed Thanksgiving. We've been hungry enough, desperate enough, in the past to be open Thanksgiving Day. But maybe we're just more mature now as a business. No working on Thanksgiving.

As for Black Friday, it's a wretched day to visit our store. There are two days you shouldn't come: Black Friday and the Saturday before Christmas. Our location has spectacularly good parking, except for those two days. You will be disappointed. Nevertheless, there's that 30% who very much want an excuse to visit us, or they'll visit someone else.

For them, I would first encourage them to visit us on the much less hectic Small Business Saturday. There's parking, there are fewer annoying muggles looking to kill time, and our Black Friday Sale will continue through Saturday.

Anyway, this is what we do, cater to customers, with the goods they want, at the time they want them. You have sales when people are spending money, and this is a prime example.

This is also a period where well meaning folks, usually professionals who earn a living at a desk, will preach about the evils of consumerism and encourage people not to shop. You do what ya gotta do with your bad self. We'll be here for you on Black Friday, Small Business Saturday, or later on at a more leisurely December pace.

Our Black Friday sales this year:

  • Buy one Get one free on all Ding+Dent
  • All Clearance and Used RPGS are Buy One, Get One free.
  • Buy a regular priced RPG Hardcover, receive a free set of Chessex dice.
  • Buy a Tactical Miniature Starter Box, receive a free set of Chessex dice.
  • Buy a Booster Box of your favorite TCG, receive a free playmat! (while supplies last)

Thanks for your support!

Wednesday, November 19, 2014

Mass Marketization of the Game Trade (Tradecreaft)

The trending topic in my brain is whether the game trade is going mainstream, if it has grown enough in the past several years, to exceed the capacities and opportunities of the traditional morass. If so, what will it mean for specialty retail?

Why would I think this? We've got Magic: The Gathering and geek centric board games making appearances on South Park. We've got mergers and acquisitions galore, including NECA/Wiz Kids buying the regional retail chain, Hastings. But what really got my attention was the acquisition of Fantasy Flight Games by Asmodee. Asmodee is owned by the 5.5 billion dollar a year French investment group, Eurazeo. Eurazeo is not not some geeky game company, it's a long term investment group that buys things like hotel chains and parking lots. Some thought went into this.

Through Asmodee, they also bought Days of Wonder last year. The Asmodee, Days of Wonder, Fantasy Flight Games trifecta now accounts for 25% of my board game sales. This company IS board games in my store. There's now no company or segment bigger than Asmodee in my store, other than Wizards of the Coast with Magic: The Gathering. WOTC Is owned by a similarly large giant, Hasbro, with their 4 billion dollars a year annual revenue.

So is there cause for alarm? I'm going to say no, for one simple fact that recently dawned on me. Geeks are a massive pain in the ass. To put it in more technical term, they (we) are focused on, and dedicated to, minutiae, fiddly details. Dude, I have a masters degree in fiddly details, on the quantity of angels that can dance on the head of a pin, the 108 thises and the 16,000 thats. I totally relate to this, but there is no way the mass market wants to wade in. Sure, they'll own it from afar, as long as it's profitable, but at the tail end? No way.

And you can't franchise specialty retail. Oh, you can try, and several have, but the fiddly nature of specialty retail with persnickety customers makes this an impossibility to scale. I talk daily with many retailers. We have solutions for everything, but it's a bit like the rabbi joke. If you get two in a room, you'll get three opinions. Nobody is wrong. Everybody is right. And there may be a better third way, because we're never quite sure. Doubt keeps us going.

There are games and game system I sell to customers I can count on one hand. Half of what I order is a single copy that never returns after its sold. In store debates rage about the smallest details of army builds and book art. We not only debate it, we identify with the choices. As one excellent article puts it:
...The defensiveness oozes over onto everything: Tau aren’t simply a valid army she doesn’t play, they must be written off as Imperial Guard with a duller paint job. GURPS isn’t a system with flaws, it’s the fools choice. Nothing is a matter of taste: if it was a legitimate choice then they’d be making it. 
My point is, mega corps are willing to sit up top and reap the rewards, but the actual work? The farm like labor of hand selling one item at a time to an incredibly finicky and fickly class of customer? No way. They're happy to let us hoe that row all day long.

Monday, November 10, 2014

Shop Early (Shop Often)

It's early November and I'm sitting on $20,000 more inventory than I normally would at this time of the year. My store is relatively full, and other than releases between now and the holidays, and some specialty orders, I'm pretty much done stocking up. If you're a consumer, or a store owner for that matter, you should shop early too, and I'll tell you why.

Port Delays. There's a three week delay at West Coast ports that will throw the game trade out of whack for the holidays. Since a lot of what we sell comes from Asia, port delays will be a holiday wild card for product availability. New products may not make it in time. Older product is likely to be in short supply.

Poor Forecasting. Game publishers have been just, absolutely, terrible this year in forecasting demand. I don't know what black magic they use for forecasting, but their mojo has eluded them in 2014. A third of our best sellers are just gone right now. Upcoming games for Tabletop Season 3 are spotty at best. Whenever I see board game holiday articles in the making, I try to insert the availability of the games being suggested. That availability is poor. The worst offenders are game companies with exclusives, but that's for another article and consumers hardly know who they are (nor should they care).

Increased Demand. The game trade is not going mainstream, despite the fears that specialty retail will soon be invaded by mass market Mongols. However, there is certainly increased demand in board games that is driving sales quite nicely. This increased demand will exacerbate our other problems. A lot of board games are made in Asia, and board games, at least for my store, are where we see really strong holidays sales. Our board game sales in December are often double a normal month, while other departments only go up 10% or so.

Online Won't Help. Internet retailers like Amazon, as well as smaller online venues get their product from the same well. Although there is talk about distributors having private reserves for some of these big online discounters, don't expect online sellers to be holding product come December. They will run out too. Our brick and mortar store has been the "last man standing" on many products this year, according to people who only buy online who don't mind mentioning we were their last resort.

So there you have it. No bitching and complaining come mid December for things you could buy now. Also, if something is coming out between now and Christmas, pre-order with a local retailer. Yes, I'm biased, but a local retailer will get at least some product, and if you pre-order, which is still pretty rare for brick and mortar, you're practically guaranteed a copy. The "Amazon screwed me on my pre-order" complaint is common during these periods with both customers as well as publishers.

Monday, November 3, 2014

10 Year Anniversary

Ten years ago today I opened my store, gleefully ignorant of the game trade and just about every aspect of retail. I learned though, because that's what I do. I came from a career in information technology where it was assumed you didn't know many things, but you learned and moved forward. I have many veteran retailers to thank for helping me move forward, and quite a few books and articles. I'm starting to write my own.

The spreadsheet that I've lived by every day, for ten years now, says we made $95.02 in sales on our first day. Despite the common retail story, I never did a day without a sale, although that following Sunday came close at $8.49. I don't recall, but it may have been a pity sale. Sales for the entire month of November 2004 would add up to an average Saturday in the current store.

I've learned a lot in the last decade, seven years of which you can see if you go back in the blog posts.  I've considered deleting them, but I keep them up so new store owners can watch the process. Understanding did not come easy.

What I didn't expect, what I couldn't expect, where the life changes that happened during that time, often in spite of the store. My son was born and adopted by us six months after the store opened. I recall getting the call that we needed to go pick him up, 400 miles away, right now. I was working the counter that afternoon.

My wife fought and beat cancer, nearly by herself, as I worked 60 hour weeks trying to pay the bills. Not being around enough is a point of friction that's still there. My current goals are college funds, retirement plans, out earning the cost of increasing health care expenses and timing vehicles so we have no more than one car payment at a time. And I always make time for that little boy, regardless of everything else. Vacations? We'll do one again ... one year soon I'm sure. Our passports are expired.

If it sounds a lot like my goals are financial, you're not wrong. Another issue with ten years building a business is you're reluctant to aspire towards risky endeavors. It's why small companies can compete against big companies. Small companies can move fast and out maneuver the risk averse. Avoiding risk as a small business owner is perhaps the biggest risk.

My ten year lesson is once you're successful after a decade, it's unlikely you'll define success the same way as when you started. That $95.02 was a big success in 2004, when I didn't even know my break even point had another $500 to go. It's nearly impossible to think down the road that far, about the kids and the mortgage and your health, which is likely less robust than when you started. If my life had shifted just a couple years to a small child underfoot and a sick wife, I'm sure I would never have taken the plunge.

The good news is happiness. Hard work and long hours is taught to be a grueling, aging, eventually debilitating and self defeating experience ... when you work for someone else. When you work hard for yourself, you become younger. You thrive. My masseuse recently told me on my 47th birthday that I had the body of a 42 year old. I'll be basking in that faint glow for weeks to come. Happiness, for me at least, means being the master of my own destiny ... with work at least.

You have to like doing this, of course. You have to not mind being in a constant state of interruption. You have to trust people, employees to take care of your baby, and maybe even open up to them as friends and colleagues, despite the risk of betrayal. The customers are wonderful too. You're job is to make them happy, to make them smile. We do this! Working everyday with people who are happy to see you is a special blessing. I've enjoyed watching kids grow up before my eyes and employees developing into capable professionals. I give these people the credit for my missing five years, because it sure wasn't diet and exercise.

Please join us for our anniversary part on November 9th, if you're in the area.