The Exchange Rate and Pricing Increases

As some of you might know, the Bank of Canada revised their overnight lending rate from 1% to 0.75%. That caused a one day CAD$0.05 drop in the exchange rate, driving us down to CAD$1.25 on that day itself. It’s now at CAD$1.27 to US$1. What does that mean? It means that a game that we purchased at US$20 last month has gone from CAD$23 (US$ exchange of $1.20) to CAD$25.40.

New Pricing

To keep our margins consistent, what we’ve done is adjusted our exchange rate calculation to CAD$1.25.  That’s a bit lower than the actual exchange rate, and somewhat lower than what we’d actually get from the bank (who take their cut when you do an exchange), but it’s what we expect the currency to be at for the long term.

Of course, we could be wrong – our currency could weaken significantly more.  It’s not as if we haven’t seen drops down to CAD$1.50 before in our history. If we do see significant changes, we’ll probably be adjusting our prices again.

Inconsistent Changes

Note that not all our products come from the States anymore due to publisher restrictions.  While it’s always been cheaper for us to buy from the States and bring the products up ourselves, due to on-going publisher restrictions; a large number of our products must be purchased within Canada.  Those include the entire Asmodee, Z-Man, Days of Wonder, Mayfair Games and Fantasy Flight Game lines.  Those prices will see changes on a more on-going basis when our distributors update their prices.  Unfortunately, we can’t predict or even guess at the prices they will charge us, so we’ll be updating when it comes in.