GW and pricing, there's a problem.

[techsoldaten]

The discussion on shipping delay/cargo delays is kind of a separate discussion,but it is still a factor in price considering the average cost of a full container has gone up 400-500%

 

I work in logistics and boy, it's bad.

 

 

Or to rephrase - the fact that one is speeding and hasn't crashed yet, despite all warnings from friends and family, does not preclude pancaking himself on a street light tomorrow.

There is a difference though. Crashing is a catastrophic event. If GW starts raising prices beyond what the market will bear, there will be plenty of warning signs and time to make course corrections.

 

 

Yes, the shipping situation is bad. Expensive containers are not the only bad thing, tho.

 

Chinese factories are going dark due to power crunches.

 

https://www.nwaonline.com/news/2021/sep/28/china-in-the-grip-of-power-crunch/

 

The cost of energy in the EU is rapidly increasing.

 

https://www.moodys.com/research/Moodys-Europes-soaring-energy-prices-raise-affordability-concerns-and-political--PBC_1305645

 

Ports are backed up worldwide, and the backups are beginning to have catastrophic effects.

 

https://www.msn.com/en-us/news/us/huntington-beach-oil-spill-section-of-pipeline-found-damaged-moved-more-than-100-feet-along-ocean-floor/ar-AAPaKvv

 

GW isn't insulated from these global trends. If cheap styrene is not being produced, disposable income is going towards keeping the lights on, and shipping containers can't get into countries, their business model will encounter new and unique challenges. I expect there to be some setbacks.

 

The time when GW was actually looking vulnerable was shortly before the launch of AOS. Kirby was slowly grinding down the company and it had lost its #1 position to X-Wing. Kirby was kicked out and GW reclaimed its crown by creating more affordable entry points to their games.

 

Not everything was perfect. The total destruction of the Old World to launch AOS lost a lot of players but GW paid attention and the launch of 40K 8th edition was a much softer reboot with Primaris reinforcing vintage Marines rather than replacing them.

 

My point is that GW have proved they are savy enough to adapt and change course if necessary. They are raising prices by increments. I bet you that as soon as sales start to dip, they will ease off for a bit. It is not like their sales will crash overnight from a single price rise.

 

 

While I appreciate all that GW has done financially over the last five years, I question whether it's reasonable to expect the same going forward.

 

There are the reasons I cited, there's also the reality of changing circumstance. Part of GW's growth in 2020 was attributable to lockdowns, people stuck at home in need of something to do. Lockdowns are beginning to recede, but so are public assistance payments from governments.

 

Not convinced the company is poised to adapt to rapidly changing business conditions. Could be wrong, but I'm not expecting growth this year.

[Dark Shepherd]

FWIW

Share price at September 7th was 12,220 which was at least a 3 month high

But has steadily declined to 9750

 

Highest in last 12 months was 12,310

Lowest was 9040

Company is value at 3.2 billion

 

Also worth noting that director Kevin Rountree has bought 25k worth of shares in August and September (after slide)

 

Shares across the board seem down. My guess is this is market worries over fuel and supply but theyll rebound and short term profits will be ok

Edited October 7, 2021 by Dark Shepherd

[Wulf Vengis]

That seems to be the eternal problem though, does it not? GWs need to constantly hunt those short term profits rather than the long term gains.

[Dark Shepherd]

That seems to be the eternal problem though, does it not? GWs need to constantly hunt those short term profits rather than the long term gains.

If they press ahead with 10th edition after 3 heavily covid affected years of 9th I will be immensely worried about their souls as well as profiteering and alienating people

[Valkyrion]

I'd be expecting 10th in summer 2023, which also ties in with the possibility of bringing 30k into the frontline - AOS this summer, 30k next summer, 40k in 2023.

 

I'd prefer a four year plan, but at least if we know then we know, you know? 

[Vermintide]

That seems to be the eternal problem though, does it not? GWs need to constantly hunt those short term profits rather than the long term gains.

This is a problem with the current prevailing model of corporate stock market big business in general. I can't think of a single publicly traded business in the West that successfully puts long term stability ahead of shareholder profits.

 

How's the boycott going anyway boys? Are you guys successfully holding your addiction in check? I heard a lot of noise about it around the other corners of the internet, but then they announced Black Templars, and I think it's safe to assume they all immediately got their credit cards out... Personally I haven't bought a figure or book since... Hm... At least November '20. Last big purchase I made was Indomitus, and I still haven't finished painting it.

 

Forgive me if this sounds judgemental, but I think for many, the problem here is in fact one of self control and moderation.

 

The "average" GW customer probably buys nowhere near as much as the more dedicated fans who are aggrieved by the price, and GW already factors that into their business strategy. I'd wager the "average" customer rarely even buys enough models to assemble a full 2000pt army. They know you're not going to carry on buying more plastic crack forever. Eventually you'll run out of shelf space, get bored and move on, etc. It's just in the nature of the hobby. So they have an extremely diverse income stream to compensate for that.

 

I think for many people, if you begin to find the pricing of the hobby (which has always been expensive) problematic, it might be time to consider if you are, perhaps, a little overly invested. You don't owe a company loyalty.

[The Neverborn]

 

That seems to be the eternal problem though, does it not? GWs need to constantly hunt those short term profits rather than the long term gains.

This is a problem with the current prevailing model of corporate stock market big business in general. I can't think of a single publicly traded business in the West that successfully puts long term stability ahead of shareholder profits.

 

A video creator linked this on this subject.

 

 

Cavet. Not saying that I agree with this, or even that it's true entirely relevant. The post just reminded me of it.

So No need to rage at me

It's predominately based around movies but you can make relevant substitutions 

Edited October 7, 2021 by Battle Brother Abderus

[techsoldaten]

 

That seems to be the eternal problem though, does it not? GWs need to constantly hunt those short term profits rather than the long term gains.

If they press ahead with 10th edition after 3 heavily covid affected years of 9th I will be immensely worried about their souls as well as profiteering and alienating people

 

We need to come up with a name for new editions released < 4 years after the previous one. They're disastrous.

 

7th edition was the first time this happened, many friends left the game over what appeared to be a money grab. I don't like the thought they could do it again.

 

 

That seems to be the eternal problem though, does it not? GWs need to constantly hunt those short term profits rather than the long term gains.

This is a problem with the current prevailing model of corporate stock market big business in general. I can't think of a single publicly traded business in the West that successfully puts long term stability ahead of shareholder profits.

...

I think for many people, if you begin to find the pricing of the hobby (which has always been expensive) problematic, it might be time to consider if you are, perhaps, a little overly invested. You don't owe a company loyalty.

 

Big brained economist response. Don't make fun.

 

The focus on short term profits at the expense of long term stability has been the stories of our lifetimes. Anyone born after 1973 has lived in an economy that values returns over civic engagement, family life, personal fulfillment and self-actualization.

 

In the 80s, the corporate focus shifted to increases in productivity while keeping the cost of labor flat. It was considered an economic miracle, you had people like Jack Welch and Lee Iacocca becoming household names and generations of business leaders crafting themselves in their images. It created to a disconnect between labor and industry, where material wealth improves for stakeholders while workers never see a raise despite the success of their employer.

 

I'm fond of charts like this, which kind of explains the situation:

 

https://www.epi.org/productivity-pay-gap/

 

... and a good book on the subject is Angrynomics by Eric Lonergan and Mark Blyth. Read about the way the West changed since the economy shifted from pursuing full employment to globalization. You'll weep.

 

The thing is, there's an upper limit to increases in productivity. Marginal increases are still possible for any business, but there's no massive spike waiting in the wings. 4th generation manufacturing has some potential, but we're in the baby steps phase of adopting things like smart sensors and local fabrication. There will be a lot of failures before anyone starts to get it right.

 

Which brings us back to the situation GW is currently facing. Oil is a source material for styrene, the plastic they use the make miniatures. EU gas prices currently put the cost of oil at about $260 a barrel, which is significantly higher than the ~$80 average that has existed for the last 20 years. The cost of using a shipping container has gone from ~$2000 to ~$30,000, meaning the boxes they use to move product outside the UK has gone up exponentially (and some data suggests TEU will hit $80,000 peak by 2023.) The cost of port congestion is a thing too, it drives up the cost of truck drivers. A friend just took a long haul driver job in Texas, he's now making $15,000 a week for a job that used to pay about $2,200 a week. The thing about his situation: he's getting paid but he's not actually driving because containers are not arriving. It might be a month before he's on the road again, depending on what happens in Houston and LA.

 

Is GW's business model going to survive as the costs of source materials / shipping / fulfillment are all increasing? Probably. These price hikes are semi-permanent, they're driven by policy and we will continue to see scarcity going forward that continues to mess with markets.

 

But it's very likely GW will have to make major changes. Alternative streams of revenue that don't involve manufactured goods (like video games, books, Warhammer+, etc) are going to be key for breaking even. They will probably need to invest in local manufacturing centers in places like North America and China to avoid shipping bottlenecks on key items. They will need to look at their pricing model very carefully and ensure every release will be positively received going forward, mistakes can have big consequences right now. And customer management will be a thing, I'm not convinced they can alienate any part of their loyal player base and expect to recruit new players at the rate they once did because there won't be the same level of disposable income.

 

The good news in all this: supply chain issues mean they can't just focus on productivity anymore to improve their bottom line. It will take a few years for things to stabilize, but most corporations will need to approach their operations differently as they move forward.

 

Maybe this means people will get a damn raise for once.

[Vermintide]

(harsh critique of neoliberal capitalism)

I wholeheartedly agree, but I won't add much else lest this thread veer into an altogether too political direction.

[techsoldaten]

 

(harsh critique of neoliberal capitalism)

I wholeheartedly agree, but I won't add much else lest this thread veer into an altogether too political direction.

 

That's not my harsh critique.

 

Allow me to share that with you in a 12,000 word post, along with charts and data going back to the 17th century.

 

...

 

Now that we've set the table, does that change your perception of the reasons for $60 Intercessors?

 

My prediction: in a couple years, cost of a single Intercessor model will be around $20. There will be no threat of 3D printing, because the cost of resin will be $200+ a half gallon.

[Inquisitor_Lensoven]

So just looked at GW’s site for a stormspeeder and saw all 3 variants listed separately for $65

 

I think this can also be considered a price hike because you can no longer buy 1 box and magnetize the weapons.

I feel like I’ll see the same thing if I look at gladiators as well…

[WrathOfTheLion]

It's the same box kit and you can magnetize the missiles, etc. on it with some work.

[Inquisitor_Lensoven]

It's the same box kit and you can magnetize the missiles, etc. on it with some work.

weird so why is it listed as if it’s 3 individual kits online?

[WrathOfTheLion]

 

It's the same box kit and you can magnetize the missiles, etc. on it with some work.

weird so why is it listed as if it’s 3 individual kits online?

 

That's how they display things. It's the same as say the Deathwing Command Squad, the Deathwing Knights and Deathwing Terminators all listed separately, even though it's the same kit. They exhaustively enumerate the units that the kit builds. This is probably especially important with more pronounced dual kit builds, like a lot of the AoS kits, or say Deathmarks and Immortals for Necrons.

[Dark Shepherd]

 

It's the same box kit and you can magnetize the missiles, etc. on it with some work.

weird so why is it listed as if it’s 3 individual kits online?

They do that with a few kits. Last I looked the one kit that Makes Bjorn the Fellhanded/Murderfang/Space Wolves Venerable Dreadnought was listed as 3 if not 4 kits

 

Its probably to make it easier to find on site and/or searches

[Oxydo]

@Lensoven

So that you can search for the specific variant you want and find it without any confusion.

Imagine searching for a Hammerstrike but you only find the Hailstrike box. That's not very customer friendly, is it?

[Valkyrion]

So just looked at GW’s site for a stormspeeder and saw all 3 variants listed separately for $65

 

I think this can also be considered a price hike because you can no longer buy 1 box and magnetize the weapons.

I feel like I’ll see the same thing if I look at gladiators as well…

 

 

They've done this for a while now - you're not buying Raptors or Warp Talons, for example, you're buying both and deciding which to make.

They've even done it with Rhinos - you get the razorback sprue too. 

 

It's for army list making purposes (and space saving purpose/money making purposes in the case of the rhino/razor!) and it's actually one of their better ideas with regards to their online shop, IMO.

[Inquisitor_Lensoven]

@Lensoven

So that you can search for the specific variant you want and find it without any confusion.

Imagine searching for a Hammerstrike but you only find the Hailstrike box. That's not very customer friendly, is it?

weird that they don’t seem to do that with all their kits then. Particularly the similar landspeeder kit.

[Oxydo]

weird that they don’t seem to do that with all their kits then. Particularly the similar landspeeder kit.

Probably because the Land Speeder is an ancient model and they only started seperating different version of kits after it was already on the website and then never got around to it. Or plain just forgot to update it.

For instance, Land Raiders' two loyalist boxes are seperated into Land Raiders & Venerable, and Crusader & Redeemer. Rhino/Razorback, Hunta Rig/Kill Rig, and Hunter/Stalker are the same.

[Cactus]

The landspeeder variants (typhoon, tornado etc) are a single 'landspeeder squadron' datasheet with weapon options, no? That will be why. Each datasheet has a corresponding store entry to make shopping easy.

[WrathOfTheLion]

They were in 8th Edition, but I think they are bespoke datasheets in 9th Edition, similar to how Predators were split. Combine the recent split with that it's an old model is likely why those aren't split on the store.

 

To add though to some previous statements, i'm not certain we'll see 10E in 2023, they also have their big The Old World launch that needs to happen sometime. I would certainly think they'll not do three years of 9E, given that there's a dead year in there for many people and getting the codices out is taking a long time.

Edited October 14, 2021 by WrathOfTheLion

[Noserenda]

Dont look at the Custodes section, itll melt your brain :D 

[Daedalus81]

Genuine question for longer term players: were the price increases prior to 2016 as bad or as frequent?

Some kits have almost doubled in price since then

 

Prices have to be viewed in relation to profits IMO, company profits werent always rocket propelled

 

There were more regular increases in the past.  GW is pricing up new kits more frequently, but I'm ok with this since those kits are often wildly better than what they used to be.

[AenarIT]

To add though to some previous statements, i'm not certain we'll see 10E in 2023, they also have their big The Old World launch that needs to happen sometime. I would certainly think they'll not do three years of 9E, given that there's a dead year in there for many people and getting the codices out is taking a long time.

Death, taxes and 40K editions lasting 3 years at most. 

Having a longer edition this time (covid, brexit, shipping delays, slower release schedule, ...) would definitely be the best option for the game, but GW sells a lot more stuff when there's a new edition drop (launch box, core rulebook, kits as more people come back into the hobby). 

[Chaeron]

 

I remember a time when they did discount sales in stores.

Then you must have been in the hobby about as long as I have.

I remember the store openings… offers like 5 for 4 on blisters or other discounts, or purchasing certain deals to get items free (especially armies from the Battle Reports in White Dwarf… or in Troll magazine!).

 

I look back on that time and recognise we didn’t really have independent stores doing the same discounting we have now - and have the wistful reminiscences over ringing Mail Order… it’s why I still love looking through old copies of WD and similar, because it was of a certain time and nostalgia is a strong force in this hobby.