Plastic Scout Pricing

[Kelroth]

You missed the prefix to 'pricing' in the title - 'over'.

[He Who Laughs]

Here's something I don't get.

Here in Australia - we don't have a foundry, we have to import all of our GW stock in from either the UK, or more recently, the US. The shipping costs make up a huge amount of the price, up to the point where in some cases (namely the cheaper price bands) there is only a very small mark-up when they hit the shelves. Shipping costs are based on volume, not weight (normally) and since all our lovely boxes of plastic models are quite light-weight for their size - they get expensive to ship very quickly.

So, riddle me this Batman - the UK and US prices for GW stock are comparable to OZ prices (going by the exchange rates) - but the UK and US don't have to ship their stock as far to sell it within their respective countries. So how do they justify charging the same prices as they do in Australia, without having to accomodate for overseas shipping?

[therisnosaurus]

my guess is it'll either be 5 for the same cost as currently or 8-10 for $35US. I'm also guessing that they'll have one heck of a lot of options, namely shotguns, boltguns, pistols/ccws and sniper rifles. POSSIBLY the heavy weapons as well, but I doubt it.

[mostholycerebus]

In an interview on Dysartes.com, Gavin Thorpe claims that the largest single cost in the production is in fact packaging - as in boxes/blisters and the actual physical task of packaging - not materials.

That wouldn't surprise me. Doesn't GW still use people to pack their boxes? Something about them not wanting to fire people and hire machines?

[Ohman]

That wouldn't surprise me. Doesn't GW still use people to pack their boxes? Something about them not wanting to fire people and hire machines?

Yes they do, every box or blister we buy have been packed by hand. However I don't think it's GW's concern for their employees that is the main reason for this. I would imagine it to be extremly hard, perhaps impossible, to design a machine that can handle all the different bitz, sprues etc. They would probably need several hundred different machines to be able to handle all the different sizes and shapes that miniatures come in.

[anarchistica]

Actually, it's quite easy, especially seeing as GW are moving towards no blisters and all boxes (and more plastic).

[Inquis. Jaeger]

Here's something I don't get.

Here in Australia - we don't have a foundry, we have to import all of our GW stock in from either the UK, or more recently, the US. The shipping costs make up a huge amount of the price, up to the point where in some cases (namely the cheaper price bands) there is only a very small mark-up when they hit the shelves. Shipping costs are based on volume, not weight (normally) and since all our lovely boxes of plastic models are quite light-weight for their size - they get expensive to ship very quickly.

So, riddle me this Batman - the UK and US prices for GW stock are comparable to OZ prices (going by the exchange rates) - but the UK and US don't have to ship their stock as far to sell it within their respective countries. So how do they justify charging the same prices as they do in Australia, without having to accomodate for overseas shipping?

It';s just simple market forces. There is a demand for their product, and it is likely that GW's product, as they have complete dominance of the market, is quite price demand inelastic, which means that if they put up their prices, demand will fall a bit, but relatively less than the price increase, which means the higher they put their prices, the more revenue they generate.

They justify their high prices because the prices are high, in effect.

[Commissar von Toussaint]

The thing of it is, if demand falls, will GW be willing to lower prices? Can they?

[Misfratz]

The thing of it is, if demand falls, will GW be willing to lower prices? Can they?

I don't think they could. Also I think there would be a hysteresis effect, whereby people aren't going to start buying lots of GW stuff again just because the price falls [a bit]. Normal economics doesn't apply to GW. [Heck, most normal economics doesn't apply to most of the economy...].

It seems that GW are chasing a high price high-quality niche with their product which makes a lot of sense. If they stand still on quality then they will ultimately lose market share and collapse. It's true that the price rises on sets that were released at £10 and are now £18, yet identical, is atrocious, but comparing those sets [which were the best of the best at the time of release] to the recent releases... and the gulf in quality is enormous. The older sets will eventually get redone, so it evens out in the end...

However, there has to be a limit to this price/quality spiral...unless Bill Gates plays Warhammer.

[Karhedron]

However, there has to be a limit to this price/quality spiral...unless Bill Gates plays Warhammer.

That limit may be further away than some people expect. The reason for this is that people's disposable income has been steadily rising in real terms for decades. Interest rates aroudn the world are generally low at the moment which means that mortgages make up a comparitively smaller proportion of people's expenses.

I estimate that about 35% of mine and my wife's income goes on non-essential purchases. Granted only a tiny fraction of this is spent on GW stuff in my case but the point remains. As long as people have high levels of disposable income then there will be a market for these kind of luxury hobby items.

The rise in the consumer lifestyle and people's insistence on a high standard of living (at least in the countries that make up GW's markets) mean that things are not ikely to change. It would take either a massive recession or a fundemental change in society's values for people to stop spending money on things like Warhammer.

[Commissar von Toussaint]

You're leaving out one other factor: Competition.

GW is no longer the only sci-fi game in town. You don't have to like the comptetition, but it is there and can easily undercut GW's increasingly bloated price structure.

Moreover, you can play GW games using non-GW figures. GW used to be into doing this for other systems, but now the wheel has turned and it is GW that insists that only its stuff be used for its games.

My thought is this: If GW is a luxury item, than it has the advantage of making more money per item than before.

This is why GW continues to post high profit: it's per unit profit is incredible at this point.

The problem is that the total volume being sold is dropping. Thus we are reaching the point where a small drop in sales means a huge drop in profit because so little is being sold.

Adding to the problem is GW's use of company stores, which really jack up their overhead. These consistently underperform in the US (mostly because we don't like the format and dont really need private gaming space) so they will drag GW down if its numbers start to drop.

A friend of mine pointed out that the Rebel Storm clickit figures are now selling for less than $1 apiece. They're pre-painted and the same scale.

He suggested building a whole 40k army of Imperial stormtroopers for 1/3 the cost of what GW would charge. As soon as I have the cash, I'm doing it.

You see, GW can't hit the kiddie crowd indefinately. Pre-painted figures beat do-it-yourself every day, particularly for the idle rich with short attention spans.

[Cloudscape_online]

Rebel Storm clickit figures... Sounds interesting...

<checking Google>

Yeah, seems a viable option.

[Misfratz]

Adding to the problem is GW's use of company stores, which really jack up their overhead. These consistently underperform in the US (mostly because we don't like the format and dont really need private gaming space) so they will drag GW down if its numbers start to drop.

Ah, well, here we come to the old UK/US culture difference. In the UK, GW has been successful precisely because of its high-street presence. If the worst came to the worst then I'd hope that GW would effectively pull out of the US before its spending on stores there dragged the whole company down.

[Commissar von Toussaint]

Rebel Storm clickit figures... Sounds interesting...

<checking Google>

Yeah, seems a viable option.

No question. I've got a mountain of round bases for them as well since I rebased all my LOTR figures on WHFB bases.