Common Entrepreneur Mistakes

Over the years, I’ve managed to make a bunch of common entrepreneur mistakes, and after reading a friend’s mistakes, it gave me the idea for this post. So, here’s my highlights:

Burnout

Burning yourself out from working too many hours is extremely easy.  There’s always something more to do, something new to get done or something that has to be completed otherwise it won’t get done.   Burnout is just way too easy. The really tricky thing is that different people have different levels of what would make them burn out.  I have a friend who has no issue with 80 hour work weeks, while many others end up burning out in 50 hours.  Worst, what you can handle throughout your life.  I used to be able to work 80 hours and not burn out, these days it’s down to 50 hours before I start having issues.

Being Pound Foolish

When we first moved downtown and I started taking over all the tasks including shipping, I decided that it’d make more sense to not pay the $15 a week to have Canada Post come pick up our packages but instead I walked the boxes to the Post Office which was 3 blocks away.  I ended up carrying 20lb / 30lb packages all the way to the office, sometimes taking a couple of trips a day. Penny pinching at its worst.

Being too nice

Sometimes, it’s just too easy to put others ahead of the business or your own needs. My most common mistake has been taking too long to let someone who just isn’t working out go in this case, but it crops up in other areas too. When you are running a business, being too nice often impacts the bottomline -and when you own the business, that means it impacts your own income.

Taking on too many projects

Slightly different than burning out, but part f being an entrepreneur is being a bit of an adventurous soul. You always want to try something new, and all too often you end up taking on a new project. And then another one. And then another.  Sometimes without finishing the one’s you first started. It’s too easy to end-up with a ton of failed projects with all your time split between them all and none ever actually finishing.

 

 

Board Game Review : Ghost Stories

Ghost Stories coverGhost Stories  has players as Taoist Monks attempting to banish ghosts from the village.  To win, they’ll have to banish Wu Feng the Lord of the Nine Hells before they themselves are defeated or the village overrun.  Ghost Stories is a tough, complex co-operative game that requires a lot of co-operation and planning to win and isn’t meant for casual gamers or those easily frustrated.

Appearance: I have to say, I love the design and images used.  It’s a touch cartoony; but there are a ton of images on all the ghost cards and village tiles which are well done and add immensely to the theme.

Stock card and miniatures are well done; though the Haunting figures might be a touch too large.  Otherwise, the design is well done with easy to read information transmitted mostly via icons and the rulebook(s) are well laid out to teach the rules quickly.

  Rules / Ease of Learning: The rules of the game are quite well laid out in the rulebook and the game is relatively simple in execution.  Each turn is broken into 2 phases, the Yin and Yang phases which constitute the ghost and monk phase.

In the Yin phase, any ghost effects such as Haunting or the Cursed die take effect before a new ghost is pulled.  If the current player’s board is filled with ghosts already; he does not pull another ghost but instead loses a Qi (life) point.   Ghosts are allocated to each player’s board according to their respective colours, with the black ghost allocated to the current player’s board.  In addition; any effects the ghost has when it comes into play are immediately put into effect.  All this information is shown on the ghost card in simple, easy to read iconography.

In the Yang phase, the player can move 1 space if he wishes.  He may then either ask for help from the Villager on his tile or attempt an exorcism at an adjacent location.  Exorcisms are conducted by rolling the dice and matching the ghosts resistance with the die results.  Any Tao tokens of the appropriate colour may be substituted for a success; and if the player is at a corner location he may attempt to exorcise both ghosts at once with his successes.

In addition; each monk has a special ability that can be used on their turn.  The boards for the monk’s are double-sided; with each side having a variation on the monk’s special ability.  As such; players have to decide on which ability they will be using that game.

Additionally; players get a Yin-Yang token that gives them the ability to use a villager’s ability or flip a haunted tile over at the start of the game.  In 2 or 3 player games, players also get a neutral token that allows them access to the un-played Monks’ special ability(s).

As mentioned, the Village tiles each represent a villager who can aid the Monk’s.  Their aid can range from flipping over a haunted tile to providing Tao tokens, healing for the monks or a Buddha token.

To win Ghost Stories, players have to defeat Wu-Feng.  However, if players all die, run the deck out or have a number of tiles (ranging from 3 to 4) haunted; they lose the game.

Gameplay: Most of Ghost Stories revolves around planning the use of the monk’s and village tile abilities.  Making sure to use the Buddha(s), the Circle of Prayers and the other village tiles as well as the Monk’s special abilities to banish the ghost is extremely important.  Players will have to work closely together to plan out their actions, often 3 to 4 turns ahead to ensure that they win.

One of the major problems with most co-operative games is the ‘alpha’ gamer phenomena where a single player takes over the planning of character actions.  In my experience with Ghost Stories, the best course of action is either blindingly obvious to everyone involved (and already agreed upon) or is a toss-up such that there’s no single right decision.  This makes everyone’s input important; and can sometimes lead to even better moves.

On the other hand, due to the random nature of the ghost card draws as well as the die-rolls for exorcism; Ghost Stories can be more random than many people can enjoy.  It’s quite possible to go from a perfectly controlled situation with 3 ghost present to having 7 ghost on the board, with a die removed and no Tao tokens able to be used all in 2 turns.   The random nature of the game can sometimes put players in a completely un-winnable situation (or make the game seem too simple as everything falls their way) and it can happen very fast.

Conclusion: Overall, I like Ghost Stories.   It has a ton of theme unlike Pandemic and it’s much shorter than Arkham Horror.  There’s a lot of decisions to make and because it’s shorter; it never feels like you’ve wasted a lot of time playing a game that you were never going to win.

 

 

Guest Review : Caylus

Caylus Box CoverIn Caylus, you and your opponents play the roles of builders who are tasked with building a village and castle for King Philip the Fair in the year 1289. Caylus is a fairly heavy strategy game that revolves around a worker-placement mechanic. Resource-management is also a very important part of the game. Not a game for beginners to European-style board gaming – there is virtually no luck involved, accommodates 2-5 players, and games often run between 1.5 and 2.5 hours.

Appearance: This is a tricky subject, because there are actually two main versions of this game. In the original (blue box) version of the game, the board/tile art is merely average, and the coins are cardboard tokens. In the limited edition (black box) version of the game, the art is spectacular, the colours are beautiful – albeit dark – and the metal coins are a pleasure to handle. The limited edition also comes with nice cloth/felt bags for the wooden player tokens, building tiles and resources, and coins.

Rules/Ease of Learning: As I mentioned in the introduction, Caylus is not a game for beginners. There is a lot to keep track of in this game, and it can be frustrating for new players to fall behind in the early game and stay there for two hours. That being said, the rules are not terribly complex – there are just a lot of them.

The game is played over a number of rounds (averaging around 15), with seven phases per round. Players receive income to fund their worker placements in the following phase. Workers are placed along a winding track, populated with six squares that are printed on the board, six pink tiles that are randomly distributed, and a number of blank squares that are filled when the players purchase building tiles.

Each square has an action associated with it – some produce resources (wood, stone, food, cloth, gold) or money, some change turn order, some allow you to build new tiles to place along the track. Each round, players may pay to move a ‘provost’ marker that may prevent some tiles from activating at all. Players may also acquire royal favours that allow them to advance along one of four reward tracks (victory points, money, resources, or building).

Additionally, players may place workers alongside King Philip’s castle, in order to contribute to the construction of the castle dungeon, walls, and towers. Victory points are primarily scored for purchasing building tiles and building sections of the castle. The game ends when the ‘bailiff’ marker (a companion to the ‘provost’) reaches a particular square near the end of the building track.

Gameplay: Though the rules are rather complex, it is the strategy and resource juggling that makes Caylus so difficult. Deciding when you should purchase a new building, when you should build castle pieces, and when you should just take a turn to replenish your resources and money can be a headache. You may sometimes have to decide between placing a worker on a tile that benefits you and placing a worker on a tile just to prevent an opponent from reaping its benefits.

Like some other moderate- to advanced-complexity worker-placement games (Dungeon Lords, Egizia), Caylus can be quite frustrating when you make a mistake. Building tiles execute in order, and it is possibly – even likely – that you will forget that at least once in your first few games, resulting in you wasting a worker because you don’t yet have the cloth you need to joust, or the food you need to build a castle piece. However, since the game is played over more than a dozen rounds, making a mistake like this isn’t quite as devastating as in some other games.

One thing worth mentioning is that individual players’ turns are relatively short in Caylus. Since there is a worker placement phase every round, and each player may potentially place up to six workers, this is important. In my personal experience – even when playing with players who usually take a long time analyzing their moves – the phases move relatively quickly, and players will rarely find themselves waiting a significant time before it is their move once more.

It will certainly take a few games to get the hang of Caylus, but it’s well worth the effort. Gamers who have played several resource-management or worker-placement games should be able to figure things out with a minimal amount of difficulty. With no dice or cards, the only random element in Caylus is the initial six pink tiles – and the order of those tiles does modify the gameplay a fair amount.

Conclusion: Caylus is certainly one of my personal favourites. The almost nonexistent luck element and the moderate degree of competition (as players vie for turn order and choice worker placements) combine to make a game that is quite fun overall. The game works best with four players, though it plays fairly well with three or five as well. If you’re looking for a deep strategy game that will keep you and your friends busy for a few hours, Caylus is a good bet.

Guest Review : Battlestar Galacitca Board Games

Battlestar GalacticaBattlestar Galactica is a 3-6 player semi-cooperative game based on the re-imagined series. Players take on the role of one of the major characters on the Galactica trying to survive after the Cylon’s attack on the Twelve Colonies. Throughout the game, players must manage of finite resources while trying to identify and mitigate the threat of any Cylons among the humans. A game of Battlestar Galactica takes about 3 hours.

Appearance: The components of Battlestar Galactica are of high quality and fit in the 12” X 12” X 3” box with plenty of room to spare. While all of the tokens, cards, rules, and board fit easily in the box, the insert that comes with the game is not at all useful once the cards and tokens are taken out of their shrink-wrap. Even a simple tray that could be used to store the cards would have been a nice touch. That complaint aside, the tokens are made of sturdy cardboard and feature clear art identifying its purpose. There are two sizes of cards: Mini-American – 1 5/8”X 2 1/2” and Standard American – 2 1/4” X 3 1/2”. Both card types look great and feature images from scenes from the television show. The smaller cards sometimes have more writing than I’d like on them, making them hard to read, but making them full- size would be too large. It’s a minor complaint and only really affects maybe 10% of the cards – and I’d prefer a little crowded over too empty.

There are 32 plastic ships in sculpts of Vipers, Raptors, Raiders, and Heavy Raiders. The plastic is a little malleable, but doesn’t seem to warp or bend much if accidentally bent a little out of shape. The sculpts are quite good and significant detail is shown on pretty small models.

The board itself is a 24” X 24” square that is dominated by an overhead view of the Galactica, with small areas representing the Cylon fleet, Colonial One, dials to track key resources (Fuel, Food, Morale, and Population) and other Tracks and card deck locations. The board is well designed and efficiently uses space.

Character cards are perhaps the best item in the box. The cards are cut in the elongated octagonal shape of the paper in the television show, which shows attention to the little details. A prominent photo of the character is shown as well as skills, character type and special abilities. Easy to read and quickly gather information from.

Rules/Ease of Learning : The rules for Battlestar Galactica are not incredibly complex, and the rulebook is generally well done. An experienced player can easily teach a new player how to play in about 20 minutes. The goal of the human players is to reach the planet of Kobol by executing 8 units worth of FTL jumps. Cylon players must prevent the human players from reaching this goal by depleting a resource to 0, a centurion invasion, or destroying the Galactica.

To start the game, players must select a character. Characters come in four types: Political, Military, Pilot, and Support, which correspond to the skills and how the character can help the Galactica. For instance, only Pilots can fly Vipers to defend against Cylon attacks, whereas Political leaders are more likely to be President, and Military leaders are more likely to be the Admiral. Players pick characters in an order determined by the table, but players must select from the types that are most plentiful (or Support). This ensures that each player has a sphere of expertise and that the largest cross-section of skills is obtained. Title cards (President and Admiral) are distributed to those highest in the line of succession. The President is the political head and can utilize Quorum cards to help the humans survive. Quorum cards can increase certain resources, brig suspected Cylons, and the like. The Admiral is the military head and receives two nuke tokens that can be utilized against the Cylon ships attacking Galactica. Both the President and Admiral also are called upon to make choices throughout the game from Crisis Cards or selecting FTL jump locations.

With the characters in play identified, a Loyalty Deck can be constructed. The Loyalty Deck dictates whether or not you are a Cylon or a Human and your Loyalty may change mid-game! The number of players and the characters in play will change the composition of the Loyalty Deck. Cards are dealt out and the remaining cards in the deck are set aside. Halfway through the game, a second card will bedealt to the players, which might change their allegiance.

Loyalty Cards are kept secret, so no one knows if or who is a Cylon. Deft Cylons can subtly prevent success of the Galactica’s crew. However, a Cylon may be discovered and becomes a revealed Cylon. Revealed Cylons harass the humans from the Cylon Fleet locations.

A game turn typically consists of drawing skill cards, moving, performing an action, and resolving a crisis card. To additional steps: Activating Cylon ships and prepare for jump are completed if a Crisis Card dictates that they should take place. Crisis Cards are either a skill challenge or a Cylon Attack. Skill challenges have a difficulty value and skill types that can help to resolve the challenge. Each player may place cards into a check’s pile but any skills contributed that are not identified as valid forthe challenge are subtracted from the total. In addition to the player’s contributions, a Destiny Deckplaces two cards in every check. This deck provides a little randomness and allows a Cylon to operateundetected by providing a degree of deniability. When a skill challenge is failed, one or resources are reduced.

Cylon Attacks represent situations where the Cylon Fleet has discovered Galactica. Cylon ships are placed on the board and create a physical threat to Galactica and nearby civilian ships. Cylon ships on the board mean that civilian ships may be destroyed (which result in resources being lost), Galactica being damaged, or Centurions boarding the Galactica.

Battlestar Galactica backGameplay : Battlestar Galactica is able to capture the feeling of the television show very well. The distribution of Loyalty Cards and the Destiny Deck contributing to skill checks feed the feeling of mistrust of your fellow players. The Destiny Deck allows Cylon players can covertly contribute negative cards to skill checks, which will make checks harder to complete, or sink the attempt entirely, furthering the Cylon agenda.

Each character’s special abilities and rules feel right and make them come alive. For instance, Baltar has the Cylon Detector once-per-game ability, which allows him to view all of one player’s Loyalty Cards. Baltar is also a coward and starts the game with two loyalty cards which increases his chance of being a Cylon and immediately makes him more suspicious. Another example is Starbuck’s Expert Pilot ability, she can make two actions when she starts her turn in a Viper; Insubordinate makes it easier for her to be thrown in the brig. Not only do the characters feel right, they seem to be well balanced against each other.

When the Cylon fleet arrives the space battles are furious and often very challenging. Strategically selecting how to manoeuvre in space to protect the fleet and Galactica is very important for the Viper pilots. Vipers are the main way for humans to prevent Civilian ships from being destroyed or Centurions boarding the Galactica.

Secrets are important in Battlestar Galactica. The cards contributed to a skill check are shuffled before revealing them, Loyalty Cards, and the Destination selected by the Admiral are all examples of secrets kept in the game. Again, this drives the tension and mistrust among the players skyward.

As a Cylon player, you need to weigh the risk of staying undercover too long against the damage you can do while unrevealed. Revealed Cylons cannot contribute as many cards to skill checks, but can activate the powerful Cylon Fleet locations. The most devastating parts of revealing yourself as a Cylon do not take place if you are in the brig – so choose when to reveal carefully.

There are a few minor issues with the game. First off, the sympathizer loyalty card is confusing and does not seem to add much to the game. The second issue revolves around the brig. If a human player is suspected of being a Cylon and is thrown in the Brig, influential players can keep that player in the Brig by convincing others to keep them there. A true Cylon would likely reveal themselves after an attempt or two to get out of the brig. A human player can only be released from the brig on a successful skill check, so particularly paranoid groups could leave a human player in the brig for the entire game – which isn’t much fun for the affected player. If the Cylons are able to get all the humans in the brig, well…game over.

Conclusion: One doesn’t need to know the television show to enjoy Battlestar Galactica, but it does help to really appreciate the game. The themes of trust and a race against limited resources are well showcased, and the characters are well designed and feel like their small-screen counterpart. If you’re a fan of the show or like games with hidden traitor mechanics, Battlestar Galactica should be on your game shelf.

Best Practices: Keep Learning (11)

The world is changing, new technology and new business processes, new competitors and new legislation make it a constant process of learning for us all.  Unfortunately, as the business owner, it often falls on to you to keep up to date.  When everything is your responsibility, it’s difficult to focus on the things that really matter.

Here’s my short-list of areas I attempt to keep up to date on all the time:

Competitors

Rather obvious, but I check-out Starlit Citadel’s competitors on a regular basis.  What are they doing that I’m not? What do they stock that I don’t? Am I missing a trick there?

It’s worth looking at indirect competitors here too – Amazon & Chapters are mainly indirect competition to me.  Yes, they stock board games, but that’s not their focus.  Yet.  On the other hand, they have a lot more marketing muscle than I do, so watching what they do can often great best practices to emulate.

Marketing

Both a personal interest and a competitive need, I keep up to date on the latest technologies and trends.  I add technology here because things like Smartphones and iPads have started to change the way our site is being used.  It’s high on our list of things to do – getting a mobile version of Starlit up.

Legislation / Bureaucracy

Not something I want to keep up to date on, but changes in EI / CPP / taxes all impact our business, never mind licensing and other factors.  Thankfully, changes are rare here and the government is pretty good on sending out information pamphlets when things do change.

Products

With all this learning, reading and research, sometimes it’s easy to forget that you need to actually learn about the products you sell.  It’s a common complaint on my side – I rarely play the games I like more than a few times because I am always looking to play new games to increase my product knowledge.

Business Books

On top of these areas, I try to pick up a business book a month and read through them.  Well, I average one a month.  These books can be on anything from warehouse management to purchasing to accounting to a beginners book on corporations.  The goal is to add or refresh that knowledge base.

Best Practices : Jack-of-All-Trades (10)

You know the saying, Jack-of-All-Trades, master of none? Well, as a business owner especially at the onset for a small enterprise like this, you’re much better off being a Jack-of-All-Trades.  There are a ton of basic skills / knowledge areas that it’s worthwhile getting a familiarity with; if not mastery.  Here’s a list of a few:

Carpentry / Plumbing / Painting / etc. DIY

If you’re running a retail store, I bet it’s even more important, but understanding the basics of all the above could save you hundreds if not thousands of dollars.  Here’s just a few things we’ve had to deal with already : unstopping a sink, dealing with leaking tap and our own shelves.

Bookkeeping / Accounting

Understanding the basics of these and how it relates to your business will save you a ton of trouble in the future.  In fact, learning to do basic bookkeeping is quite useful – no one else will understand your business as well as you do, and that is often the difference between inputting the right information into your accounts.  Whether you outsource this or not, make sure to have someone professional at least set-up your accounts in the beginning and walk you through it if you don’t understand the various capital / inventory / expense / revenue lines in your P&L and Balance Sheet.

Btw – I don’t suggest doing your taxes yourself.  At least in Canada, the corporate tax filing system is quite thick and complex.

Marketing

Yeah, marketing is important.  Simply defined, marketing is anything you do to get & keep a customer. It’s an art and science and unless you specialize in it, you won’t be as good.  Still, understanding the basics of marketing in your area is important – if nothing more than to ensure you aren’t taken for a ride when you do hire someone. So, pick up an introductory textbook to understand at least the basic strategies and if you’re in retail, ‘Why We Buy’ is a must-read.  So’s Guerilla Marketing, though realise it’s written for a US audience.

Legal

I don’t expect you to know the intricacies of the law, but understanding the differences in business types (private vs public companies, limited or self-owned businesses and partnerships) as well as the various intricacies of owning a corporation like shareholder agreements, articles of incorporation, the various shares in your company will hold you in good stead.  In addition, it also means you’ll be able to file the routine paperwork necessary.

Purchasing / Logistics

Purchasing is the mainstay of any retail business.  Get this one wrong and you’ll destroy your own business.  Get it right and you have a chance of surviving.  Here’s a few things you might need to learn : What are turn rates? How many copies of a game should you get? What are the delivery times between distributors and costs? What is an acceptable stock-out rate for your business? And how do you pack a box properly – the sizing requirements, the amount of fill and packing tape among others.

Human Resources

Human resources covers both the soft skills of managing employees and the hard skills of the legal requirements.  There are a ton of legal work in hiring, some of them in BC include WorkSafe BC, EI, CPP, Taxes, payment remittance and the T4 forms.  It can also include looking into things like company wide benefits and hiring.

Sales & Customer Service

Do I even have to explain why? Sales does require practice, so if you can do it on someone else’s dime, that’s always good.   Learning the basic skills in querying customers, upsell’s & conflict management goes a long way in keeping your bottom line healthy.  My general go-to when selling in-person is to ask what the customer what they are looking for, then check off questions on theme, game group size, complexity and length of time.  Any previous games they have played and enjoyed are another great resource for narrowing down choices.

Information Technology

These days, a minimum business requirement is a website.  You can of course get someone to design & code and update your website for you, and if you don’t have the basic skills here it might make sense.  Still, knowing at least how to update your site for current news like events, new games & important announcements will make the site much more effective.

However, basic IT skills also includes things like setting up your Internet connection, wireless router & payment center.  Being able to trouble-shoot the basic problems with your internet access & printer will save you a ton of trouble.

Conclusion

Those are all the main skills I can think off right now, I’m sure others will chime-in.  While money fixes a lot of problems, if you’re a small business, money is always tight.  I’ll discuss cashflow & the P&L sheet later on to help you understand why.

Best Practices : Schedule Me Time (9)

Running your own business is a lot of work.  If you own a brick & mortar store, it’s probably worst than online – at least I can work remotely and wake up 30 minutes later if I need to.  It’s easy to end up working  70, 80 hours a week.  Sometimes, it’s necessary – but whatever the case, make sure to schedule time for yourself.  There’s a lot of reasons for this including:

Burn-Out

If you are working all the time, sooner or later you’ll burn out.  You won’t care anymore about the work you are doing, which will mean you make mistakes, annoy customers and generally begin to hate what you do. At that point, why bother owning your own business?

Health

Your health is very, very important.  When you first start out, you’ll likely be a 1 man operation with little to no back-up.  If you are sick, the entire operation shuts down.  So eat properly, sleep well and exercise regularly. It’s also worthwhile noting that unless you have an employed spouse, you’re down to just the basics of MSP.

Creativity & Innovation

Sometimes, the biggest problems seem to solve themselves when you step aside.  Our unconscious mind is much, much more powerful than you’d expect.  Quite often, when you step aside from work, the best ideas of how to handle the business will pop-up.

Maintaining Relationships

Look, none of us are islands.  Whether it’s significant others, family or friends, if you disappear into the blackhole of work, you’ll lose contact and erode those relationship bonds.  These relationships are extremely important, and if you don’t take time to care for them, it will break down.  Practically as well, it’s a lot easier to ask favours from someone you saw recently rather than someone you saw a year ago.

This is particularly important for your spouse.  Making sure you spend time with them makes certain that your most powerful supporter is on your side.  Especially in my case, where I use my wife as my bouncing board for everything in the business; they can get really tired about the umpteenth problem you’ve had that week.

Best Practices : Penny Pinching & Being Penny Wise, Pound Foolish(8)

Money and cost cutting is a strange beast.  You can be too loose with your spending and too tight as well, and learning where the right level is just a matter of experience.

Penny Wise

It’s very important to cut costs in business.  It’s better to cut your cost by $1 rather than increase your revenue by $2 in most cases as a game store.   There’s also a lot of areas to cut – rent, insurance, salaries, your gateway fees, etc. to name a few.  Checking your costs every month and every year (depending on when your contracts come up for renewal) is very important.

Depending on your personality and background, this can be  really easy or really hard.   Either way, the discipline required here is key to running a business.

Penny Wise, Pound Foolish

The other danger is one that I fall into all the time. I’m naturally quite careful with my money, and it was enhanced by our  lack of capital in the first few years.  As such, I had a tendency to not spend any funds at all – which caused a lot of trouble.  As an example, I refused to pay Canada Post to come by to pick-up our orders and instead dropped the orders off myself at the Post Office.  It saved me a whopping $15 a week – and meant I wasted an hour or so every day doing that.

Return on Investment

So how to avoid that trap? Here’s a new term for you – Return on Investment.   How much revenue will this activity / spending generate for me? Or, conversely, how much will it save me?

If your advertising is expected to generate $1000 in new sales, it’s worth it if it only costs you $200.  If it only generates $500, then it might not be worth advertising.  Same with a new retail location.

Or conversely, saving an hour a day at $10 an hour is worth $50 a week.  A definite improvement over not spending $15.

In general, I use an ROI of 3 as a cut-off point.  That’ll vary depending on your business, your costs and  your comfort level, but I find it a good  rule of thumb.

Best Practices : Negotiate, Negotiate, Negotiate (7)

When you are running a business, always be looking to negotiate with your various suppliers.   There’s a lot of expenses involved in running the business – insurance, distributor discounts, rent, salaries, etc- and nearly all can be negotiated upon. As we know, reducing costs is extremely important to running a profitable business.

I’m not going to write a long post on negotiations – there’s a ton of well written books & posts out there about negotiating.   Here’s the basics though:

  • Do your research and make sure to know the general prices & terms involved
  • Talk to multiple suppliers
  • Think in multiple dimensions; not just price
  • Be willing to walk
  • Don’t rush your decision
  • Always review the final contract
  • Leave something on the table

Here’s a quick example drawn from the business – negotiating with distributors.  Now, we have a ton of distributor accounts.   Most we don’t use or rarely use, but overall it’s 7 or 8. When talking to distributors, there’s a few areas to look at : price of the games (and price on specific publishers); selection (i.e. which publishers they carry), shipping costs (free shipping threshold), return policies, number of days to arrive & terms.

So when negotiating, the areas that can be adjusted include the price of the games, shipping costs & threshold and the terms.  The other areas are unlikely to adjust much (other than perhaps selection if you’re big enough to ‘request’ sourcing from a desired publisher), but if you know what you’re willing to give-up; you can potentially negotiate better areas within any of the above.  So, for example we have great terms with one distributor but a lower free shipping limit on another.

One thing though – I always try to ‘leave something on the table’.  I always think in terms of relationships – i.e. long term so I rarely ‘push’ a single negotiation to the limit.  I’d rather come back in six months to a year, with new growth numbers and re-negotiate than to push the limits and potentially set-up an adversarial relationship.  In the long-term, the benefits of a good relationship plays out better I believe.