Convention Attendance 2015

I figured we’d post our convention list for this year. Come visit us if you are there:

February 27 – March 1, 2015 – GottaCon Gaming Convention, Victoria, BC

March 14 – 15, 2015 – Terminal City Tabletop Convention, Vancouver, BC

October 2 – 4, 2015 – VCon Science Fiction & Gaming Convention, Vancouver, BC

October 16 – 18, 2015 – Fallcon, Calgary, AB

We’re look forward to seeing you at one of these conventions and playing some board games with you.

Online Game Retailer Group

So, as mentioned, we’ve created a small Online Game Retailer Group on Facebook. If you’d like to join (as an owner / manager of an eCommerce store dealing in gaming products), you can find the link here:  https://www.facebook.com/groups/754728627968431/

Lots of prep going on for the upcoming convention (GottaCon) and then Terminal City Tabletop Convention 2 weeks after that.  I’ll try to get an article up in -between but it’s pretty buys so I have no guarantees on that.

 

If You’re Lonely And A Retailer…

Thinking about the recent geeklist, one of the comments and one that I’ve echoed before is how lonely running an online store in this industry can be.  The challenges we face, and the intense competition, can create barriers to discussion.  However, writing this blog has brought about some interesting conversations – there are now a couple of online retailers that I talk to on-and-off via e-mail and/or phone.

I’m wondering if there’s a demand for something a bit more formal? I know Facebook groups are quite popular among B&M retailers in our space, would there be a demand for an online retail store group? Is there anyone else who is reading this blog who’d like to chat but are feeling hesitant?

If there is one, comment below. Let’s chat, be happy to manage that group and we might be able to help one another out.

 

Addendum and Edit: Would people prefer an actual (private) forum or a Facebook Group?

Why Run an Online Store

It’s strange, after reading of the demise of another competitor, one would wonder why you’d bother to build an online store.  That’s a very good question, and certainly one that I’ve asked myself a number of times.  The profit margins are extremely tight, with both customers and competitors always looking to lower it even further.  There are quite literally competitors in Canada who sell products at a loss – as part of their business plan.  So, why bother?

Love of the Industry

Let’s be truthful here, most of us could be working in another industry / another business and making significantly more than what we are earning doing this.  Heck, from speaking with a lot of B&M owners, the profit levels at B&M stores can be significantly better too.  Knowing the industry, at least you don’t need to learn the product  (as much) as with starting out in an industry that you don’t know.

Low Capital Costs on Startup

This is a tricky one – it’s easy to start-up the business with much less capital than most brick & mortar stores.  Most online stores start running out of their houses / apartments, keeping stock in their spare rooms or living rooms and shipping orders out every few days.  So, instead of $50 or 100k, you probably can start up at $20 or $30k.  Or even less….

Flexible Hours

It’s easier to fit an 80 hour week for an online store than a B&M store around other life commitments.  It’s still not uncommon for me to get online at 11pm and start working after spending the evening with my family.  You can still go out in the evenings, hang out with friends for a bit and then go home and work more on an online business compared to a B&M store.  You put in the same ridiculously long hours, but they are more flexible.  And when you’ve got family obligations too, that can be extreemly important.

Introvert Friendly

If you aren’t a people person, running a B&M store is going to be significantly more difficult. I know, for myself, that there’s only so much interaction that I can deal with at any one time.  Working in an online store puts a ‘wall’ between you and the constant amount of customer interactions, so it’s a lot more introvert friendly.  Answering an e-mail is so much eaier than talking to a person.

Scalability

This is more a theoretical idea than one that I’ve seen yet, but it should be possible to scale an online store much easier than a brick & mortar store.  At a certain point, you’ll max out the sales per square foot that a B&M store can handle at which point you’d have to either move to a larger location or build a second store.  With an online store, your physical location is much less important so moving should be less of an issue while purchasing should be ‘simpler’.  After all, when restocking a game, if you have to restock 10 copies or 2, it’s still a single line on the invoice and search.

I write about the challenges we face as an online store more often than the advantages, so I thought this list might be a nice counterpart.  If you can think of something I’ve missed, feel free to chime in.

Game Salute Now Available

We just concluded an agreement with Game Salute, so we will now be able to bring in and ship their products in Canada.  Due to their tighter margins and minimum pricing policy, the products will be basically sold at Canadian MSRP.  We should receive our first shipment from them in a few weeks, in the  meantime, if you see anything that you’d like us to bring in, let us know and we’ll add it to our site so that you can pre-order the products.

We are somewhat excited to bring in some of their exclusives though including Alien Frontiers and Cthulhu Wars.

Mixing Business Models

One of the most common questions or queries about our future for the business is whether we’d open a retail store or a game cafe.  Truth be told, both ideas are one’s that we have tossed around.  There are significant advantages to developing a physical location (beyond the warehouse) but there are significant disadvantages too.

New Processes

Running a physical store requires a whole series of different processes than an online store.  SKus have to be priced (everything), a point-of-sale system needs to be added and preferably integrated with your online store inventory.  You need to redo the shelves to add enough space for the disabled, adjust them to allow for proper showcasing of products, review the way games are shelved for traffic flow, train staff differently and of course, events.

Now, for a game cafe you have the vents, all the food & beverage requirements including the laws that pertain, the game library that has to be up-kept and if you’re selling as well, all the above.  Not to mention, you have to worry about ‘turning’ your tables fast enough to continue to generate a decent revenue from the floor space.

None of these processes have anything to do with the upkeep our online store (adding products and descriptions, images and inventory), the pulling, boxing and shipping of orders and the marketing involved in running an online store.

Higher Costs

As many have pointed out, warehouses are cheaper to run than retail stores.  We’d expect to pay at least double what we currently pay for our lease amounts and then you face an interesting question – do you move the entire operations to run out of the retail store or do you run them seperately in 2 different locations?  If you are large enough (see Chapters), you have multiple locations – but if you aren’t, it might make sense to defray some of the cost of holding all that stock by running it all in 1 location.  However, now you’re selling product that is priced to be competitive online (i.e. lower margins) on a higher per square foot location.  That means you need the retail portion to make the difference in the retail cost, at a lower price point.

In addition, remember how I said the shelving needs to change? Creating shelving for everyday consumers is very different than for a warehouse – for one thing, we can squeeze and/or build up much more easily and effectively than retail stores.  So you’re less effective in using the space that you do have.

Anothe rmajor cost is the increased cost in employee time. Shipping and running the online business is a full-time job.  Having customers come in, browse and play at events means you need a second pair of eyes and hands – just to keep yourself from being shop-lifted to major losses. Again, higher costs.

Opportunity Cost

Opportunity cost is the cost of not doing something.  If I spend the $60 – 100k launching a physical store, I’m not spending that money on something else like growing the online store.  The question the becomes one of ROI – even if I could make the game cafe profitable, what if it’s only 2x the return when I could spend the same amount of money and get 4x the return?

In the end, we are still a distance away from building out to a physical location.  We’d need a significant amount of funds that are not available.  In addition, being an online store provides a lot of hidden benefits (beyond the lower cost) that I currently enjoy.  More on that another week.