Monthly Archives: March 2017

I call myself a layman, because I am not a Magic player, my store is not a majority-Magic business (though it briefly was when I opened), and though I’ve been open for only six years, I am not a distribution expert.

It’s been a bad couple of sets for Magic. Wizards needs a home run. Most of distribution is crunched for cash and needs at least a base hit. Many Magic-heavy retailers are not in a great cash position, judging from how many of them went out of business following the Red October outages.

My gut feeling after witnessing the unexpected Eternal Masters reprint was that Modern Masters 2017 was going to be printed heavily.

When spoiler season arrived, and the set became more and more ridiculous, I became more fearful as other retailers rejoiced. The set was too good. Acknowledging that I’m probably a little jaded, I expressed some concerns that it might be a cash grab. If the value of your product lies mostly in a back catalog of valuable IP that you can release whenever you want, the correct play would seem to be to restrict it to a steady, modest flow. To suddenly throw the lever all the way over and allow the value to gush out seems to send the same signal as a store throwing a sudden 50% off sale: The customers will rejoice, but partners in the business may see the blood in the water.

My allocation from Wizards was modest, but Distribution told me that I could get more. A lot more. In fact, I haven’t talked to anyone who wasn’t offered at least double their official allocation. Almost everyone I know took it. I didn’t.

Release day. Prices in my neck of the woods were driven down by area competitors selling the $240 MSRP boxes for $200 and $188. That’s sometimes advertised as the tax-included price, which is illegal in this state and hints at wider misbehavior, but that’s the norm. This matches the online price, which at the time of this writing is about $200.

Here’s something to ponder: Look at the industry-standard discount applied to booster boxes of regular sets. My store and many others sell a Standard booster box for $110. This is not an exciting sale for us. The profit from a booster box at that price will pay my payroll for about 39 minutes, assuming my pay as an owner is zero. If you apply that same discount to a box of Modern Masters, then you’d expect the demand curve to meet the supply at a price of about $195. Is Modern Masters supposed to be just another set? No? Then why does it appear to be printed like one?

On Friday, the weekly product list emails from Wizards went out. After rumors of an eight-box restock offer, we were all surprised to see that the offer was twenty additional boxes. If you were Wizards, and you had or intended to print a few more trailer-loads of this product, but you didn’t want to let on that supply was infinite, what would you offer as a first-week restock? One hundred would certainly cause a panic. Even 32 is more than many retailers were allocated, for all that those allocation numbers mattered. Twenty seems right. Many retailers I’ve seen talking about this hurried to get in their restock orders as early as possible. Every restock order is being filled. None have been turned away.

Wizards, being a subsidiary of Hasbro, a publicly-traded company, is not doing anything wrong, and is accountable to shareholders who demand profit maximization. Ultimately Wizards doesn’t, shouldn’t, and legally can’t care whether the margin on their products at market price is 42% or 12%. Their wholesale price is the price they get, so the only question is how many boxes they can ship at that price. I’ve stated elsewhere that the supply of young adults happy to throw the best years of their lives away running unprofitable game stores seems nearly infinite. If you had such a resource, your shareholders would require you to use it.

I want very badly to be wrong about this launch. Many of my dearest friends went deep on this product. If I’m wrong, then I will blow through my allocation at MSRP and be unable to get more. I will have made a good bit of money while watching my friends make a lot of money. If I’m right, then I guess I’ll have the prestige of having called it correctly, but I’ll struggle to sell my product at MSRP among the throngs of retailers desperately dumping the product so that they can pay their terms.

So far I’ve sold one booster box and sixteen boosters. I have heard from other retailers that are selling lots of product and seem to be doing great. There is still time for me to be wrong. Please, let me be wrong.

I’m going to make this very brief, because it’s super-late and I am EXHAUSTED.

TCGPlayer just announced TCGPlayer Pro. It looks to be a hastily-designed Crystal Commerce killer. The limitations so far are that it does not have a POS solution, and it does not support multi-channel integration, meaning that you can’t use it to sell on Amazon or eBay.

For many small stores, however, this is just the thing.

The retailer forum threads predictably caught on fire and are still burning brightly at 200+ posts. Many of the posts are from retailers saying that they are getting up early tomorrow morning to go into work and switch immediately to TCGPlayer Pro. I have some advice for my tier:

• DON’T jump immediately. You have waited this long, so you can wait three or four more days. The next 48 hours are going to be the sort of madness you can only get by announcing a major rollout and declaring that it’s available RIGHT NOW. You don’t have to do anything right now. You can afford to wait to make sure you’re doing it right.
• DO immediately do a backup/export of your inventory and sales data. Assume that your Crystal Commerce data could become temporarily or permanently unavailable at any time. This is going to be a period of fundamental change for Crystal Commerce, and whether they will survive it is an open question. I will say only that I backed up my data in 2012 before I told Crystal Commerce that I was intending to leave, and I wound up being very happy that I did so.
• DO remember to be a professional and a human being. From a business perspective, a company has to do a lot of things wrong to get to the point where 150+ of their customers will sit in a conference room and cheer their demise. Crystal Commerce did it to themselves. From a personal perspective, these are real people with real needs and fears. Not everyone at that company made the decisions that caused you to hate them. PLEASE be professional in your contacts with them, because you’re a professional. If that appeal doesn’t resonate, I’d ask you to treat them humanely, because you’re both humans. Your business has nothing to gain from you kicking them on your way out the door.
• DO talk to your TCGPlayer onboarding person about your POS options. Right now those aren’t there. I don’t know if TCGPlayer is planning a POS rollout, but my hope is that they would move toward openness in allowing others to integrate with their platform. That would allow me to keep using my point of sale software. It would allow IMP POS to pivot into a POS solution that works great for retailers. It would allow retailers still on software like Lightspeed to have modules developed that allow for integration. Your voice will matter for this. They are listening. (Also, tell them that Paul from Too Lazy To Fail wants to fly out to them and talk to them about their plans for Video Game integration. We can make a lot of money together, guys! Let’s do this.)

Next week is the GAMA Trade Show in Las Vegas. It’ll be my second year attending. Vegas is just about the most anti-Paul place I can imagine, but the amount of education and networking I got at the show last year means that I wasn’t going to miss a second helping of it this year. Some tips if you’re making the trip for the first time this year:

• Bring a fan, white noise machine, ear plugs, or all three. The nightclub thumps permeate everything late at night, and even if you’ve upgraded to a nicer room, you’ll want them if you like to sleep.
• If you’re not from the desert, bring a baseball cap, eye drops, lip balm, and sunscreen. No convenience store there is selling sunscreen this time of year, and it’s important, especially if you’re planning to drive to Phoenix in a convertible after the show. Ask me how I know. Ugh.
• Wear comfortable shoes. Last year I brought dress shoes and sneakers. I switched to the sneakers halfway through the first day.
• Dress code: There are no rules, but I will silently judge you if you wear cargo shorts and a dragon shirt. In my opinion, a company-branded T-shirt is bare minimum, and a polo or button-down shirt is better. You don’t have to wear a suit. Would you say that you are a professional? Then dress somewhat professionally.
• Don’t take bottled water from people on the street. Be aware of the many scams and cons being run and protect yourself. Carry your wallet and phone in a front pocket.
• If you think you’ll want a car, consider Silvercar. They run a promotion for first-time customers that is very enticing: I got an Audi A4 for the week for $250. They’re in the app store of your smartphone.
• If you want the box-o-free-stuff from GAMA, you’ll need to attend one of the Premier Presentations in every time slot. These are the pitches from publishers, and they are of variable quality. Last year I went to every one, and I wish I hadn’t. This year I am going to the ones that I have an interest in, and focusing on talking with other retailers the rest of the time. The free stuff just wasn’t worth it for me. If you’re bringing an employee, it might be worth throwing them under the bus to get the freebies.
• Attend every retailer seminar that you can. These are the reason that I go to this show.
• Meet as many retailers as you can, seek out the ones that are professionals running profitable businesses, and try to get some face time with them. It’s particularly important to me to talk to the folks who are clearly doing it right while also clearly doing it differently than the way I do things. This is how learning and improvement occur.

I hope that you’ll consider attending the presentation that Michael Bahr and I are giving on Tuesday and Thursday, which is simply “Video Games” on the schedule. It is very generous for GAMA to give us a presentation slot, given that they self-describe as an association centered around the non-electronic game industry. Used video games are a high-volume, high-margin category that mix very well with the non-electronic games that I sell, and I’d like to help you get there as well. I’ve sold used video games professionally across multiple jobs for about 12 years combined, and Michael is a more traditional game store owner who diversified into video games last year. You’ll hear the perspective of a video game store that also does non-electronic games, and a non-electronic game store that diversified into video games.

If you see me out and about at the show, I’d like to at least shake your hand and hear about your store. If you catch me and ask, I’ll give you a free bracelet that will help you remember what matters in your business. These can also be used with a small zip tie to make a loop that is handy on your keychain. If you’d like to meet with me while we’re both in town, email me or send me a Facebook message. A note on Facebook: I’m very selective about accepting friend requests and I try to keep my current count below a certain number. Just because I don’t accept your friend request doesn’t mean I don’t want to talk to you or meet with you.

Monday is looking very busy, but I’m available and eager to chat on Tuesday afternoon and evening, all day Wednesday, Thursday afternoon and evening, and Friday afternoon and evening. Offers of coffee, cheeseburgers, and small numbers of adult beverages are welcome bribes. I am not much of a party-goer, gambler, or sight-seer, but I definitely want to talk about our businesses.