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Tarred with the same brush (Distribution Issues)

November 2nd, 2016 Posted in business
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tar_brushA day after we did our post about distribution challenges in the gaming industry, we receive news that PSI has now informed their US distributors not to sell to online only physical stores.  If you don’t know, PSI does the distribution for nearly 30% of the industry (most everyone who isn’t gobbled up by Asmodee like Steve Jackson Games, Arcane Wonders, Catalyst Games, Stronghold Games, Indie Boards & Cards and more).  This is the same day that a post on Reddit titled “My local game store smells so bad that I don’t want to go in” hits 852 upvotes and generates a ton of conversations.

PSI (potentially at the pushing of it’s publishers, potentially by themselves) decided that game stores that reek so bad that potential customers refuse to go in are better ambassadors for the game trade than we are.

Hyperbolic much? Maybe, but since we seem to be tarred with the same brush, why don’t I use it on all B&M stores? No fair, but then who is being fair or reasonable here anyway?

Let’s be clear – there is an issue in the industry where board game prices in particular have hit a point where many B&M stores are reducing or even removing their support of the category beyond fast-selling staples.  There are a lot of reasons bandied around but the reasons that get spoken about are:

  • Alpha gamers picking up the ‘hottest new games’ from Kickstarter releases direct
  • Online discounts on average at 30-40% off MSRP.
  • Mass market businesses poaching gateway gamers from B&M stores (who now can’t / don’t have the chance to convert these customers like they used to).

Here’s the thing.  If you look at the above issues, 2 of 3 of those problems are created / supported by publishers because it works very well for them.  Kickstarter allows them to launch more games with less capital and make more money.  Mass Market sales allows them to generate more sales with a much, much bigger footprint than probably the entire B&M store industry.

That means online discounts (and online discounters) are the only people they will go after to look like they are doing something.   There are numerous policies coming into play to stop this.  In the US, ANA decided to just restrict sales to a few online stores.  In Canada, some have gone with a MAP program (even if it is technically illegal).

PSI’s strategy is to restrict it to B&M stores only.  However, that’s not going to work.  Most of the large players in the online world are B&M and online, so it wouldn’t stop them from purchasing.  Worst, half (at least!) of the problems come direct from B&M stores who find themselves with too much product and are just dumping the product.  Solutions like this are more PR than actual solutions, intended to appease than fix the real issues.  Mostly because the real issues are either extremely expensive to fix or because, perhaps, they aren’t fixable.

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