Kickstarters in 2017

As many of you know, we help publishers ship items within Canada. Last year, we did a total of 45 Kickstarters in Canada, more than we’ve ever done. Here’s the list:

 

01.04.17 Santorini
01.19.17 BrilliAnts
01.24.17 Ghostel
01.28.17 Siege of Dragonspear(video Game)
02.2.17 Vampire Hunter D(Comic)
02.9.17 Battleborn Legacy
02.15.17 Dresden Files Card Game
02.16.17 Rare is Everything(Book)
03.02.17 Flying Pig Redux
03.02.17 Unfair
03.09.17 DVP -Shadows
03.14.17 Rare is Blah Redux
03.15.17 GameFolio
03.17.17 Too Many Bones
03.20.17 Gnomi
03.24.17 Betabotz
04.04.17 Pirate Nation
04.7.17 DicenStein
04.11.17 Scurry
05.02.17 Flying Tents
05.04.17 Dark Blades RPG
05.18.17 Cthulhu Wars
05.26.17 Dark Blades 2 RPG
06.1.17 Xia
06.5.17 Cthulhu Wars 2
06.29.17 7th Seas Theaoth
07.13.17 Summit
07.24.17 Star Traders
07.26.17 Shadows over Brimstone
07.27.17  Roswell 51
08.14.17 Brides and Bribes
08.18.17 RDI6
08.25.17 TMB2
09.10.17 GloomHaven!!!!
09.15.17 Stop Thief
09.29.17 Monsoon
10.13.17 Flying Pigs
10.20.19 Caledonia
11.10.17 Mistborn
11.24.17 Bluebeard
12.07.17 Watches
12.18.17 Bullets
12.19.17 BlueBeard
12.29.17 Destiny Aurora
12.29.17 Get off my lawn

Canada Post strikes, UPS & Scythe Shipping

Canada Post on Strike Again?Canada Post is likely going to have a strike / lock-out in July.  Nothing officially confirmed, but it sounds like it’s going to happen. Here’s how we are handling things and how it is going to affect shipping at Starlit Citadel.

Canada Post Strikes / Lockouts

The lockout is currently rumored to happen in July, probably July 1 as the postal workers are looking to vote on the strike on July 2. As such, any Canada Post shipment that is estimated to deliver before June 31, 2016 will be fine (unless you aren’t able to receive the delivery and aren’t able to pick it up before then or the shipment gets delayed).  In other words, we CANNOT guarantee a shipment that is en-route for delivery around June 31, 2016 and later will arrive as it might get stuck in Canada Post’s warehouses.

We will likely turn off Canada Post delivery completely next week as anything ordered after Monday is unlikely to get delivered anyway.

UPS Shipping

We have turned on UPS shipping in Canada in the meantime.  You will notice a huge difference in pricing between UPS & Canada Post due to the difference in our contracts and base costs between the two companies. If you are in the East Coast / Maritimes and a rural location, we recommend using UPS anyway as they will be able to make deliveries to your location during the strike even if you order rihgt now.

Free Shipping Promo of $100 cancelledFree Shipping at $100 Promotion Cancelled

Please note, the Free Shipping promotion at $100 is now cancelled as we are not able to run this promotion while shipping via UPS.  Previous pre-orders that need to ship out during July wills till ship for free.

We have re-instated usual free shipping promotion – that is, shipping is free for orders over $175 (before taxes and after discounts) so you can still receive free shipping on your orders, it’s just going to be at a higher level.

Scythe Shipping

Lastly, for those who have Scythe shipments going out from our facility. We are working as fast as possible to get all shipments to the Maritimes / Quebec / rural East Coast out today. We currently have 7 business days before July 1, so we’re hoping to get as much out as possible in the next 2 days so that all shipments will be on the way to customers and in their hands before the strike happens.  This means that if you are in the West Coast, unless we have processed your orders already, you might not get a processing notice for a few days as we take care of these backers as we have more time to get your shipments out.

Jamey will have a more detailed update for everyone later. Please bear with us as we are working as fast as possible to get as many shipments as possible out to everyone.

Spinning wheels

Posts on the business side have been particularly quiet lately.  There’s a lot of things going-on behind the scenes of Starlit Citadel, but most of it would be dead boring to those not involved in it.  For example, the last few months have been a huge struggle getting our database from the site-merge between SC and Fortress Geek sorted out.   Hours and hours of combing through data, checking over products and finally, the final site-merge which has still left numerous bugs in the other site.

None of that is of interest to people outside, beyond the occasional bugs that crop-up on the site because of the work we’re doing.

On top of that, our Kickstarter Logistics program has seen significantly more traffic (read, I’m giving a lot more people more quotes).  Not a huge amount of additional business and what there is, is months down the road.  However, it is important to get done and I’ve yet to train anyone else to take over the answering of those e-mails, so I’m stuck dealing with it.

All of which mean posts on the business side have been of the lowest priority.  Hopefully in the next few months I’ll have a little more free time to get back to posting.

Crowdfunding Fulfillment

As many of you know, we have been completing Crowdfunding (Kickstarter) Fulfillment for Canada and recently have branched out to doing fulfillment for the US as well.  In addition, we’ve been getting a lot of inquiries asking us for pricing and other details.  While we have been happy to answer those questions, I thought it might make more sense to create a singular website with all that information and the numerous questions we get asked. So, we did – Starlit Citadel Logistics.

Not particularly inspired in terms of naming, but I think it gets the point across.

The Business Case

I’ve mentioned before that in terms of actual business sense, crowdfunding fulfillment will never pay our bills.  A ‘big’ Kickstarter like Red Dragon Inn 5 which we just completed only had about 200 or so backers in Canada.  We charge $3 per order handled and that includes box cost.  So, on a ‘big’ Kickstarter, our revenue is $600! We’d have to do a lot of Kickstarter’s to cover the cost of the space in Canada.

On the other hand, the Kickstarter in the USA was significantly larger – over 10 times.  At those rates, you only need a few ‘big’ Kickstarters (or a lot of small – medium sized Kickstarters) before you are able to generate a decent revenue stream.  It’s part of the reason why we started offering the option down in the USA, and partly because we had quite a few questions from Kickstarter creators who wanted to know if we would do so.

This will still be a very much side-project, one that I’ll tackle (i.e. market) when I have a bit of free time and/or need a break from my current projects.  We seem to have generated some great word of mouth and I am content to let the business grow that way.

In the future, expect most of our posts on Kickstarter Fulfillment directed to the other site.

Oh, and I swear I’ll get back to writing more blog posts soon. Things have just been very busy on the backend and finding mental energy and time to write posts, especially posts that I can publicly post, has been in the premium.

Kickstarter – Shipping Challenges

We just completed the second of our Kickstarter fulfilment contracts from SchilMil Games for their game Manifest. I’m not going to comment on the game itself – readers can look it up; since what I wanted to discuss was the actual fulfilment aspect.

As many of you know, we do this as a sideline and help for Kickstarter publishers. It’s not as if we do a lot of them (this is number 2 in nearly a year of offering this service) and we don’t make a lot at all. The goal for us is to help publishers get their games to Canadian backers at a cheaper rate, not really make oodles of money. Since we already have the facility and experience shipping, it’s not really a big thing to add this on. On the other hand, as many publishers know; Amazon Fulfilment can be extremely cheap and is often the better option to go to.

Anyway, for Manifest, what we found is that we probably have to adjust our quoting method. See when we quote an estimated shipping cost we use both the game weight provided to us and an estimate of where games will ship to. This is based off our own shipping patterns in Canada, so a weighting towards BC / AB is added in. In this case, the estimated pricing we provided was $10.50.

What we found was the actual average was $13.25. This came from shipments mostly being sent to Eastern Canada (Ontario / Quebec) and only 1 to Alberta. That caused the weighting and cost to go up substantially. In addition, game weight was a factor. The game itself weighed in at 1.8kg but due to volumetric adjustments, it came to 2.56kg in what was charged.

Overall, we saw a minor loss in the shipping of this Kickstarter; mostly in the processing / salary cost. Overall, it’s a good learning experience as we continue to offer this service. It’s in particular worth noting that we are now able to help with US shipping of Kickstarter games too.

Kickstarter / 3rd Party Fulfilment

Please note, we now have a full website dedicated to our 3rd Party Fulfillment Services.

One of the newest things we’ve started exploring in the last few months is being a 3rd party fulfillment centre.  The reason we’ve started looking into is more of a coincidence.  We worked with Common Man Games to help with their Heat Kickstarter and the upcoming Police Precint reprint and are potentially talking to another party to act as a fulfilment centre.

Then, we had a discussion with the Euphoria designer, Stonemaier Games with regard to their game itself and mentioned we might be willing to do fulfilment.  He had a post coming up on Kickstarter fulfilment, and so we threw together a rough costing outline.  Taken directly from the post:

If a pallet of goods is shipped to us in Vancouver, BC, we will break it down into individual orders and ship them directly to Kickstarter backers. As all of the stock would be shipping out almost immediately, there’s not storage cost. We would charge the following rates to ship 1 simple order per backer (1-2 individual games, or a pre-made bundle containing multiple items), totaling 2kg or less, anywhere in Canada:

  • Receiving cost: $20.00/hour, including unpacking all of your games, and inspecting them for damages. We can receive roughly $1000 worth of goods in 1 hour.
  • Handling cost: $3.00/order, including collecting items, packing them with appropriate padding, creating a shipping label, and sending tracking details to the recipient.
  • Shipping cost: $13.00/order if packed in a 13″x10″x4″ box (fits standard-sized Euro games like Pandemic, Puerto Rico), or $14.00/order if packed in a 12″x12″x4″ box (fits standard Fantasy Flight Games, and larger Euros like Dungeon Petz, Euphoria). This covers Canada Post Expedited Parcel service, which ships to Ontario/Quebec in 4-5 business days, and across the country in about 1 week. Shipping is fully insured, and we would be responsible for missing parcels, damaged goods, etc.

Other services that we can provide for an additional charge include handling cross-border shipping and brokerage for the initial shipment (we have the option of using a shipping address in Blaine, WA and bringing stock across ourselves), processing more complex orders (multiple tiers of custom backer rewards, etc), and handling backer support within Canada by sending out replacement parts for defective copies. The above is a basic estimate for our most simple service, and we’re happy to discuss every designer’s specific needs with them and providing a customized quote.

 This is a rough costing and is subject to change.  Shipping cost might be significantly higher or lower, depending on what size the game / product is.  For example, for the Heat we just shipped it via Lettermail.  The order handling cost is for a few easy to pack items – I’ve seen Kickstarters (e.g. Bones) where there a million variations on the product type.  Those are much more complicated than a few variants.

The one thing I’d love to lower is our shipping cost, but until we get to the size of Amazon, it really isn’t possible.  Anyway, if you have questions or are interested in taking part in this program, you can always e-mail us direct at ksadowski@starlitcitadel.com and we can discuss the program in more detail.

 

Idle Thought – Timelage, sales and kickstarter

Firstly, not a post bashing Kickstarter.  I was just wondering on my way in to work if any publisher had any data about the changes in sales numbers between:

– directly published games

– Kickstarter games

Obviously, their own games so this limits the number of individuals with this information to a very small number.

Within that context and probably separately as well, I’d love to know what the numbers for sales were like between the start of first promotions to final release / wide release.

None of this actually effects me as a retailer of course, I just like data but I wonder if there’s a correlation between when you start your promotion, when you release the game widely and final sales.  That is, is there a sweet spot in promotion that would drum up enough interest to maximise your sales? Or perhaps there are multiple sweet spots – first, a selling cycle in Kickstarter and then again when it releases – but if so, is there a noticeable drop in wide release sales due to Kickstarter and if so, does it correlate to how long it’s been since you started your promotions / Kickstarter?

Obviously, I have no data. I’m just curious.

Too Many Games!

We’ve been slowly seeing more and more games arrive, more releases as the entire market and Kickstarter come into play.  And I have to say, there’s major disadvantages to this flood of games that keep arriving.

More Badness than Ever

It’s safe to say that there are bad games out there.   In fact, there are horrendously broken games and games with themes that are just wrong.  At the end of the day, there are games that for one reason or another slip past whatever gatekeepers there are and are released into the wide world of distribution.

Let’s assume there are 10 bad games in every 100 releases.  Further, let’s say there are 60 meh games (okay, not great, not bad) and 20 good games and another 10 great games.  Now the last 30 games will switch depending on who you ask (what’s good is after all in the eye of the beholder) and maybe even the bottom 20-30 games will vary (i.e. what’s truly horrible to me might be  meh to another).   We’re still talking about a lot of bad games out there; games that almost everyone can agree just aren’t that great.  Obviously the numbers are made up, but the idea holds true.

Now, if for some reason more capital is injected into the industry – more publishers set up shop, Kickstarter gets even more popular, etc. Let’s say the ratio of good to bad games stays the same.

The end result? There’s even more bad games to wade through than ever.  The probability of you finding those 10 great games suddenly drops off, because you now have to look through even more games (in sheer volume).

Don’t Blink

I’ve talked about the lie of infinite shelf space.  Assume that we want to get as many of those great, good and mediocre games as we can onto the shelves because we know that will sell.  Now, if a 100 games release every month, we need to shift those games ever faster because we’ve now got to find shelf space for those 70 games we’ll bring in next month.

So what happens? We shift some older stock off the list – we say goodbye to Louis XIV, El Grande, Princes of Florence, classics in their own right.  This is happening right here, right now.  Mediocore games, marginally good games, all of them come in and shift off the shelves ever faster because we have to find space for the next new game.  So don’t blink, those games are gone.

Why do you care? Well, perhaps a good game that is good to most might be great for you.  Maybe it’s the perfect game for you and your group.  And you’ll never find it, because it’s gone.

Boom to Bust in 60 Seconds

Think it’s bad for you? Think about how bad it gets for publishers.  Their window of profitability gets cut ever shorter with this.  They need to start making back their funds in ever shorter periods as retailers are forced to rotate stock out.  Sure, Kickstarter might pre-sell a ton of their games but then the question becomes how much more should they print? If your average Kickstarter does 1000 games pre-sold, do the publishers just print 1000 games or 2000? Those last 1000 games have to be sold somewhere – and their window in the retailer’s shelf is ever shorter.

Eventually, publishers might cut down on their print runs further; printing maybe only a few hundred copies more than their Kickstarter numbers because they can’t afford to take the risk of sales through normal retail.  If that’s the case, then games become more expensive (smaller print runs = higher cost) and disappear from shelves ever faster; with reprints not available.

Lower Profits, Lower Service

Publishers and retailers suddenly have less interest in any one game.  If you know you can only sell a 1000 copies (most of it through Kickstarter); then if you want to make a profit you need to pump out games at a faster rate as a publisher.  That means less playtesting, less Q&A when printing.  That means any one single game is less important than making sure each new game gets out faster and that poential errors can be glossed over faster since everyone’s attention span is less.

For retailers, you can’t learn 100 games every month.  So games become commodities, things that come and go.  You can’t provide as good a service because you don’t know the games that well.  You can’t play every game, you can’t even play 10% of those games.

 It Ain’t Over

I’m not saying it’s all bad and I doubt my posts or opinions will change anything.  However, I do think it behooves us all to realise that there are major disadvantages to this move to bypass gatekeepers, to the crowd-funding of games and the increasing number of games arriving.

 

Kickstarter & Demand

Gary Ray of Black Diamond Games in California has an interesting post on Kickstarter.  To sum it up, he is pulling back from stocking Kickstarted products as he has found he can no longer sell a Kickstarted game.  It’s become such an established distribution system that all his customers who might be interested in a particular item have already purchased it at the Kickstarter level.

As always, he’s probably ahead of the curve in speaking up about a potential problem and it’s quite clear that this has become a problem for brick & mortar stores.

Our Perspective

Truthfully, we don’t have the same level of problem as he does. There are a few reasons for this:

  • Game Salute – many of the Kickstarted games out there have gone through GS as their distribution partner.  Whether they end up in the main distribution channel or not, we can’t get those games.  So we’ve been ‘shielded’ to some extent from bad or small runs.
  • Wider customer base – our customer base is wider.  We reach right across the country and by nature of the internet draw more customers from the fringes
  • Lower Prices – obviously a number of customers are individuals who’d rather buy a game discounted rather than at full price.
  • Canada – or specifically, shipping costs to Canada for Kickstarter games can make it more less cost efficient to back a project than for US customers

That being said, we have seen this issue as well.  There are a few publishers that we purchase games from but there a lot fewer Kickstarted games that we’re willing to take a chance on.  Some of it is the quality control issue – there seems to be a higher percentage of games that aren’t that good that get Kickstarted compared to traditionally published.  In addition, we have seen reduced demand for a Kickstarted game – games that we could (probably) have sold 3 to 4 copies before they were Kickstarted have dropped to 0 to 1 copies.  So we aren’t immune, just sheltered.

On the Industry

Kickstarter is a major game changer.  It’s a disruptive technology that has allowed publishers to generate more profits and shift risk by contacting and selling games direct to the public before the game is made, often with perks that are not offered to retailers.  It’s gone from a fringe system among board game publishers to a relatively main stream option.

There’s a lot of parallels that can be drawn from the publishing industry (see Kristine Kathryn Rusch’s blog for a more thorough discussion of the publishing industry and the changes it’s caused there) and how independent writers can actually make more money selling fewer books online direct than selling through the ‘traditional’ sales channel.  This encourages more writers, each selling fewer books but also more books in total.

We aren’t there yet and there’s obvious differences such as the added complexity of board game production, the higher cost of production and the more complex distribution model but it’s an interesting parallel. There will obviously be designers who will want to publish through traditional game publishing channels and others who Kickstart their games and take on the added responsibilities.  The question is, what will the percentages be between the two and more importantly, where the next ‘big’ hit is coming from?

Worst, what if all or most traditional publishers start selling direct to the public through Kickstarter?  If publishers are taking all the ‘easy’ sales, then retailers have to work even harder for smaller profits.  This could kill the retailer / distribution model if a large enough percentage of publishers go this route.

Possible Solutions?

Well, the obvious answer for publishers is ‘don’t do it’.  At least for traditional publishers, they should stick to their current model.  Of course, this isn’t likely to happen – businesses are in business to generate the most profits possible, and direct sales for publishers are the most profitable solution (at least in the short-term; potentially long-term).

Some publishers have seen this problem and the harm it’s done (or doing) to stores and have attempted to include them.  Here’s what I’ve seen tried:

  • Retailer support levels.  They don’t work.
  • Local (free) pickups at a retail store. Varies but doesn’t seem to do much in terms of generating new profits
  • Non-versioned games (i.e. no perks for customers so same game as the retail model).  Most such campaigns don’t get funded thus far.

Here’s a few ideas that might help:

  • Retailer-only versions of games.  Take some of those additional profits, put them into new production f a version of the game that is sold only with retailers.  The trick is to make this version good.
  • Consignment sales.  Instead of selling us games, send them to us as a consignment.  We’ll pay you what we sell and return what we don’t.  That takes out the capital risk and allows us the option (and time) to potentially push the game. Of course, you then hit the problem of limited shelf space.
  • Better discounts. The old 50% split was based on the distribution model where the publisher generated his revenue  from about 35-40% of MSRP.  With Kickstarter games, he generates 93% of the revenue (after Kickstarter fees I believe this is correct) in the beginning.  As such, when selling ‘remainder’ copies to the retailer, he

At the end of the day, the idea behind each of the above options is to provide a greater incentive to retailers to stock a Kickstarter game.  The first creates demand or at least splits the demand, the other two can increae the ‘length’ of time a game can stay / is pushed on a retailer’s shelves.

Side Note:  There’s a tacit admission in Gary’s blog about demand creation.  Retailers like us can create new gamers (increase overall demand), but we have only limited influence on which games are actually purchased especially when dealing with ‘alpha’ gamers.  With new gamers, we can influence their decisions but alpha or long-term gamers often have their own opinions and needs and are only marginally influenced by the retailer themselves.

 

Fear & Loathing Online

As an online game store, it sometimes feels like the entire industry is out to shut you down.  We’re the evil demon in the mists, the boogieman destroying the fabric of the gaming universe.  We are the bad guys.

The Loathing

We’ve had publishers refuse to sell to us, restrict sales of certain items, issue pricing dictates and offer Brick & Mortar (B&M) stores additional retailer incentives. We’ve had distributors refuse to do business with us, or attempt to dictate how we run our business if they do sell to us, or selectively refuse promotions to us because we are an online store.

Other retailers have attempted to get us discredited, refused to talk/work with us in their industry forums and been actively hostile in person.  We’ve even had some predatory marketing practices targeted directly at us.  And the purchasing public can be just as hostile (if not more so) than any of the above.

The Hypocrisy

What gets me is the hypocrisy often shown by the above.  Many of these publishers will sell online & direct themselves and/or sell to big box stores.  They’ll go to Kickstarter (another online sales method) and provide incentives to customers but not provide them to retailers, cutting directly into a retailer’s customer base.  Yet they’ll state in their very next breath that they are all about supporting ‘the gaming industry’.

The public will complain about online retailers, but then refuse to pay more than MSRP or for the space they use to try out games and socialize in B&M stores.  They’ll buy from Amazon, yet continue to talk about ‘supporting local businesses’.  Retailers complain about online stores but then use eBay to get rid of their additional stock or run online stores themselves.

Distributors at least are mostly up-front about their motivations – they just want your money; and often would sell to you if they could.

If There’s One Thing…

Can’t we all just get along? There’s a lot to love in this business, but this aspect of it is just frustrating and disheartening.  Some days, I really do just want to go evil. Then I take a deep breath, tell myself it’s just business and get on with being the best damn game store we can be.