How To Get Rich In the Game Industry

 SO you want to open a game store? Much like real estate, the joke goes that the easiest way to make a million in the game industry is to start with $2 million. Very few people get rich in the game industry. The only ones of which I know for sure are Richard Garfield and Peter Adkinson. One of them created Magic: The Gathering and the other one published the same game. Catching lightning like that has happened ones in about 30 years. A goodly number of people in the industry do well enough to have a solidly middle class lifestyle and even more do it because they love it, working very long hours for a lower middle class/upper lower class income. If you want to get into the industry, make sure you have enough capital on hand to cover ALL of your expenses for the first 6 months and do not expect to draw an income from the store for at least 3 years.

Trade Ins

 When you bring stuff into a store for trade or sale, it is generally a good idea to check ahead of time regarding the items they are looking for, so that you do not waste your time or theirs. Case in point, we had a guy bring in a camera to sell to us today. Not something we would deal in at all and we told him that. Calling or contacting the store otherwise ahead of time will save you quite a bit of time.  

Older Comics and Games

 Why are older comics and games getting so much more valuable? Because they were read and played, often by kids. And Kids are notorious for not taking care of their stuff. Remember how you had to be told by your parents to pick up after yourself when you were young? Nearly everyone who played with a game or read a comic during that time did the same. That meant a lot of games with worn or lost pieces and comics with bent spines and torn pages.

Now, those same kits are 30 years older and looking to revisit their pasts through the games and comics they remember from that time. Unfortunately, those games and comics are seldom in good condition. Ergo the scarcity of games and comics in good condition drives the price up.

We just got in a stack of comics from the 1980s, some of which would be worth $50 or more if in good condition. Unfortunately, it looks as if a bored kid with time on their hands got ahold of them and there are pen marks all over them, making a $50 book worth about $5 or less.  

Comics were designed as disposable literature and much of it was. That is why there are comparatively few of them around.

How People Will Spend Their Dollars

 

Prices were going to start falling as the money from last year’s stimulus checks worked its way through the economy but with the war in Ukraine and sanctions imposed on Russian exports, expect to see them moving up again. Sanctions against Russian mean there are sanctions in place on their international trade against three of the major oil producers in the world:  Russia, Iran, and Venezuela.  The world’s economy has been doing OK with the sanctions against Iran and Venezuela but Europe, last time I checked, gets about 40% of its oil from Russia. The US, currently the number one oil producing nation in the world, has promised to ramp up oil production to help fill the gap left by the expected loss in Russian oil production, although the sanctions may provide exceptions for energy, which makes them much less effective. According to S& P Global Platts, about 75% of the world’s sunflower oil comes from Russia and Ukraine and  just under 25% of its wheat supply comes from the two countries, so disruptions in the supply from both of them will mean further, and longer term, price increases in the food supply. Food is a necessity, games and comics, luxury items. When it comes to how to allocate dollars as prices rise, food will (usually) take priority over entertainment. Although it is doubtful we will see the double digit inflation rates of the late 1970s, the current 7% rate still triples the numbers we have seen over the last 20 odd years and will likely continue for most, if not all of this year. What do you think? Post in the comments or email castleperilousgames@gmail.com

Emphasizing the "Collectible" in TCG

 

I fear that WOTC/Hasbro has glommed onto the “ collectible” aspect of the collectable card game aspect while downplaying the “game” aspect of it. The introduction of Set Boosters and Collector Boosters do little to enhance gameplay, but instead target the collector market and, while collecting has always been part and parcel of the Magic universe, it was subsidiary to gameplay:  “How will this card improve my deck?” While early sets of Magic did, on occasion, include multiple tyles of the same card, the various season illustrations on Urza’s Tower for example, they were few and far between, with most players happy to have 4 to put into their deck, without worrying about getting all the variants. From what I can tell, WOTC’s current marketing plan, with the introduction of Alchemy  focuses on moving actual play online, as I have had a number of customers comment, while promoting the collectible aspect of the game with a number of variants of each card available with each release. Set boosters and Collector boosters are specifically designed for this market, which, according to WOTC is large enough to drive demand for the two additional varieties of card sets within the past two years to what is essentially a segment of the Magic target market. Add in, by my count, 45 Secret Lair releases in the past year and the Magic market has seen a lot of product flooding into the market within a short period of time.

Grading Comics and Cards

 The average price of a collectible comic book has more than doubled since this time in 2020.  If you want a comic book graded and slabbed, expect to wait 5-6 months to get it back. Cards are even worse. Because of the boom in Pokemon collectability, over the past couple of years, the card grading companies are scrambling to find more staff. Most have doubled their staffs and it still takes about 12 months to get a card graded. 

Effects of Inflation on the Industry

 Prices were going to start falling as the money from last year’s stimulus checks worked its way through the economy but with the war in Ukraine and sanctions imposed on Russian exports, expect to see them moving up again. Sanctions against Russian mean there are sanctions in place on their international trade against three of the major oil producers in the world:  Russia, Iran, and Venezuela.  The world’s economy has been doing OK with the sanctions against Iran and Venezuela but Europe, last time I checked, gets about 40% of its oil from Russia. The US, currently the number one oil producing nation in the world, has promised to ramp up oil production to help fill the gap left by the expected loss in Russian oil production, although the sanctions may provide exceptions for energy, which makes them much less effective. According to S& P Global Platts, about 75% of the world’s sunflower oil comes from Russia and Ukraine and  just under 25% of its wheat supply comes from the two countries, so disruptions in the supply from both of them will mean further, and longer term, price increases in the food supply. Food is a necessity, games and comics, luxury items. When it comes to how to allocate dollars as prices rise, food will (usually) take priority over entertainment. Although it is doubtful we will see the double digit inflation rates of the late 1970s, the current 7% rate still triples the numbers we have seen over the last 20 odd years and will likely continue for most, if not all of this year

New Capenna Date Change

 

Wizards of the Coast has announced it will release the physical version of Magic the Gathering-Streets of New Capenna on April 22 rather than the previously announced date of April 29, leaving the digital release date on April 28 (See Wizards of the Coast Prioritizes FLGS ‘Magic:  The Gathering Prereleases Over Digital Release) Instead of a day after the digital release, stores will get the set almost a week ahead of time. Since spread of information about the physical product is generally slower than information transmitted through the digital realm, meaning we will not see play results moving through the Magic world nearly a quickly as they would if the cards released online first. Online players can build and play decks more quickly and spread information about them much more quickly than physical players can. By delaying digital release, we will likely see even a greater delay in single card prices settling than we do now. As it is, we wait about two weeks before trading for cards from a new set in order to give prices time to settle down. Quite often, especially with Yu Gi Oh!, a hot card spikes high on initial release and then drops in value very soon after. We have graded for brand new cards in the first week a few times in the past and seen the value drop precipitously soon afterward.

Change is Coming

 

Consider this:  in the past it took decades if not centuries for humans to widely adopt technological change. The printing press, telegraph, automobile. Today, however that change can spread in a few decades or less.  The  smartphone is less than two decades old and, according to BankMyCell already over 80% of the population has one. Similarly, according to DataReportal, social media, also less than 2 decades old, is now utilized by over 57% of the world’s population. Countries and private organizations are installing renewable energy sources at a blistering rate. Polio vaccine took two decades to develop, we managed to create one for COVID-19 in under less than a year.

What’s the point? Change is coming at us faster and faster. What took decades can now be done in a year or two. In the game industry, we have seen a massive ramp up in online board and RPG play, watching other people playing RPGs, card and boardgames have become viable means of entertainment and those selfsame people appearing on the streaming platforms you want cane move sales with just a mention of the game. Witness the effect the games sales of just a mention of the Skull card game on TikTok. https://icv2.com/articles/columns/view/50051/rolling-initiative-three-trends-will-likely-continue Only a couple of years ago, only a few games even considered buying and using metal dice in a game, now our store sells 2 to 3 sets a week at a price I would never have thought anyone would pay for a set of dice. Our store has at least 3 Chinese manufacturers contacting us directly want us to place orders for metal dice with them.  10 years ago, there was no way I could feasibly justify purchasing metal dice in quantities to make the buy profitable. Today it is quite feasible.

Similarly with dice towers and dice trays. Both have been available for years but only in the last few years, as a greater number of people sale them in use on various RPG play streaming shows that demand for them increased to the level that made stoking a good selection of them with a dozen or more manufacturers offering both in assorted designs.

So what changes can we expect to see over the next few years? Here are couple of things I think will come about

Reshoring to Mexico—Although not feasible in the immediate future, i.e. next year, I expect to see some boardgame production companies open up factories in Mexico over the next five years and, under the USMCA, companies will see significant tax and cost advantages compared to importing from China. In addition, a much shorter supply chain will shorten the turnaround time. The quicker the US market can get a product, the quicker it can sell, and the quicker channels will need to restock. A shorter supply chain speeds the turnaround process dramatically.

More Kickstarted TCGs-  The success of Flesh and Blood and Metazoo have put dollar signs in the eyes of other creators. https://icv2.com/articles/news/view/49780/witness-greatest-show-rathe-next-flesh-blood-set WE have gotten several solicitations from several companies launching their own TCG with funding secured through Kickstarter and I expect to see a glut of these hitting the market over the next few years. Unfortunately for most of them, the “Ladders in the Mind” concept says that most markets have room for a Number 1 and a Number 2 with all other competitors battling it out for third place. Currently we have three battling it out:  Pokemon, Magic and Yu Gi Oh with no indication of any of the three fading away to give space to an upstart. I expect some to gain attention for several months or a year or two and then fade away, much like the The Crow TCG (You did know there was a Crow TCG, right/)

Used Boardgames

 Just picked up a large collection of used boardgames. Working on processing them now and should have them out on the shelf by Saturday.

Masks

 In accordance with the latest recommendations from the CDC, we recommend wearing masks and will provide them on request but no longer require them to shop in the store. We, of course, can change this policy if we see surges in infections and deaths from COVID-19