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View Full Version : Mark Wells explains why you non european types can't be sold to



tezdal
21-05-2011, 13:41
From Games Workshop's Facebook,
"Our CEO Mark Wells has written a letter in response to people who have contacted him to express their concerns over our decision to restrict European trade accounts from selling outside the EU. We asked him nicely if we could also post it here for all of you who have been letting us know how you feel on Facebook and so here you have his personal reply.

Sincerely,

The Web Team

Dear Hobbyists,

Thanks for contacting Games Workshop about the change in our trading terms for European accounts. I know this has frustrated you and for that I am truly sorry. As a long standing customer, you deserve to know why we made this decision.

As you know, we introduce people to the Games Workshop hobby of collecting, painting and gaming with Citadel miniatures through our Hobby Centres and local independent trade accounts. Games Workshop Hobby Centres run introductory games and painting sessions, beginner lessons, hobby activities and events. We provide all these services free of charge. We only recover this investment if customers then buy products from us.

Where we don't have a Games Workshop Hobby Centre, we support local independent trade accounts. These businesses provide a convenient place for customers to buy our products close to where they live. We support these businesses with local customer service teams and warehouses to ensure customers have immediate access to our best selling products and new releases. Many customers discover the hobby this way.

In addition we invest millions of pounds every year in our design studio and factory to ensure that each month we release more new products. This makes the Games Workshop Hobby more exciting for existing customers, helping them stay in the hobby longer. We can only afford to do this because of the volume of customers we have recruited and developed through our local Hobby Centres and trade accounts.

It is for this reason that we have changed our European Trade terms. Over recent years, a number of currencies have moved a long way from their historical relative values, and this has opened the door for some traders to try to take advantage of these currency movements and offer deep discounts to overseas hobbyists. This has been the case with European internet traders selling to some of our customers overseas.

While this may seem great in the short term, the simple fact is that European internet traders will not invest any money in growing the hobby in your country. Their model is to minimise their costs and free-ride on the investment of Games Workshop and local independent shops in creating a customer base.

The inevitable consequence if this was allowed to continue is that Games Workshop would not be able to operate Hobby Centres, nor to support local trade accounts. And if this happened in more territories outside Europe, the loss of volume would leave Games Workshop no choice but to scale back our investment in new product development, further eroding our customer base. Not something that we or our customers would want us to do.

That is why we took the decision to take legitimate action to restrict European trade accounts from selling the goods they purchase from Games Workshop outside Europe.

While I understand that you may still be unhappy with our decision, it was taken to ensure we can continue to support the Games Workshop hobby communities around the world through our Games Workshop Hobby Centres and local trade accounts. And to ensure we continue to invest in developing the best possible new product releases every month. I hope therefore that over time you will see the benefits of this decision for you and your hobby.

Yours sincerely,

Mark Wells
Chief Executive
18 May 2011"

uona
21-05-2011, 14:38
The inevitable consequence if this was allowed to continue is that Games Workshop would not be able to operate Hobby Centres, nor to support local trade accounts. And if this happened in more territories outside Europe, the loss of volume would leave Games Workshop no choice but to scale back our investment in new product development, further eroding our customer base. Not something that we or our customers would want us to do.


Did he just admit that they currently have an eroding customer base? I thought the official stance was that everything was fine?

Spectrar Ghost
21-05-2011, 14:52
Did he just admit that they currently have an eroding customer base? I thought the official stance was that everything was fine?
Whoops! .

orkz222
21-05-2011, 14:52
Where we don't have a Games Workshop Hobby Centre, we support local independent trade accounts.

These businesses provide a convenient place for customers to buy our products close to where they live.

Many customers discover the hobby this way.


It is for this reason that we have changed our European Trade terms.


Yours sincerely,

Mark Wells
Chief Executive
18 May 2011"

Its not convinent for me to go down the LGS to buy as I have to spend transport $$$ and time to just go down to buy say an over-price bottle of paint/boxset whatever I need for my games.

Buying from online store, I just click here and there, wait 1-2 weeks and its delivered right at my doorstep. No transport cost, no travel time and 1 order just take at most 10mins to complete.

The LGS did not introduce me to the game, it was a gaming buddy who introduce it to me.

Change the EU trade terms and I also change my buying habits :D to stopping my monthly GW purchases.

Griefbringer
21-05-2011, 14:52
Did he just admit that they currently have an eroding customer base?

I don't think so, there are a bit too many if-conditions in that paragraph. I think the way he intended it to be read would be something like:

"If our customer base would be eroded outside Europe, the loss of volume would leave Games Workshop no choice but to scale back our investment in new product development, further eroding our customer base."

Coasty
21-05-2011, 14:55
I don't think so, there are a bit too many if-conditions in that paragraph. I think the way he intended it to be read would be something like:

"If our customer base WERE eroded outside Europe, the loss of volume would leave Games Workshop no choice but to scale back our investment in new product development, further eroding our customer base."

Grammar-fix!

logan054
21-05-2011, 14:57
It is for this reason that we have changed our European Trade terms. Over recent years, a number of currencies have moved a long way from their historical relative values, and this has opened the door for some traders to try to take advantage of these currency movements

I think this is the best part of the whole thing, pot, kettle, black.

Coasty
21-05-2011, 14:59
Yeah, 'cos GW would never do that, eh?

What...?

spaint2k
21-05-2011, 15:00
If GW actually sold to the foreign independent (and their own) stockists with the same trade prices as UK companies get, maybe this problem could be solved. Of course, that would mean paying more than lip service to the ideal of "growing the hobby" in foreign markets.

I'd love to post this on Facebook, but I'm too damn stupid to figure out how to comment on other people's "notes". Can anyone teach me (via PM)? Or post the same thing to their facebook page? EDIT I have to "like" their page first...

uona
21-05-2011, 15:01
I don't think so, there are a bit too many if-conditions in that paragraph. I think the way he intended it to be read would be something like:

"If our customer base would be eroded outside Europe, the loss of volume would leave Games Workshop no choice but to scale back our investment in new product development, further eroding our customer base."

If that were so shouldnt it have read "eroding our customer base" Instead of "further eroding our costumer base"

Granted english is not my first language but when i read the further I understand that our customer base is already eroding and if we do this it will erode more. Without the further i would understand it as if we do this our customer base will erode.

Of course I could be missing some nuances that native english speakers have which means I am not understanding the statement correctly.

Coasty
21-05-2011, 15:03
If that were so shouldnt it have read "eroding our customer base" Instead of "further eroding our costumer base"

Granted english is not my first language but when i read the further I understand that our customer base is already eroding and if we do this it will erode more. Without the further i would understand it as if we do this our customer base will erode.

Of course I could be missing some nuances that native english speakers have which means I am not understanding the statement correctly.

Actually, he's right in using 'further' there (it's actually the 'would be' that doesn't make sense in English grammar).

Basically, what he was saying was:

'If X were to happen, and we allowed Y to happen it would allow X to happen even more.'

Lordalador
21-05-2011, 15:20
So I'm not a customer to GW if I buy their product in an online store? (scratches head). Something about that doesn't make any sense.

PsyberWolf
21-05-2011, 15:56
So I'm not a customer to GW if I buy their product in an online store? (scratches head). Something about that doesn't make any sense.

No, GW wants to funnel everyone to their stores where they can pay the maximum price possible!

Wells statement is nothing but self-serving drivel! If they were really concerned about European resellers (read Wayland and Maelstrom) taking advantage of currency fluctuations (read Australian currency) they could easily do a once per year price adjustment to bring it more in line with the UK price. Aussies would be alot less likely to purchase from a UK reseller and more likely would buy from their LGW or LGS. Instead by limiting trade they have monopolized the exchange advantage for themselves! Now only THEY make that extra money since the LGS in Australia pay in Aus currency.

Australians take note - GW wants to totally wallet-rape you by making sure that you pay double what they pay in the UK and US!

theunwantedbeing
21-05-2011, 16:00
Seems fair to be honest.

PsyberWolf
21-05-2011, 16:05
Seems fair to be honest.

Reasoning?

Trustey
21-05-2011, 16:09
I think this is the best part of the whole thing, pot, kettle, black.


Hey you! Stop doing that!

So I can do it...

Danteng7
21-05-2011, 16:10
Seems fair to be honest.

How to be fair when we are paying more than twice the amount you guys at UK are paying?

Does it mean ppl outside of UK are richer and thus dont mind paying 2 times more than what consumers in UK are paying?

And there are many countries that doesnt have a GW or indie store, so ppl in these countries dont deserve this hobby?

enyoss
21-05-2011, 16:24
Did he just admit that they currently have an eroding customer base? I thought the official stance was that everything was fine?

I think he's saying people are still buying the products, but they're buying them below market value from certain traders thanks to currency conditions.

At least, that's how I read it :).


How to be fair when we are paying more than twice the amount you guys at UK are paying?


To be fair, if I were working in Australia my salary would be almost doubled due to the difference in currency, pay practices and conditions. So I think there is a fair argument for regional costing if they are operating outlets and doing business in these areas. I admit that I can't say much for Singapore though!

ltsobel
21-05-2011, 16:35
So basically they are are complaining that web shops are stopping them ripping off Aussies etc and making money out of it at the same time? Those naughty shops are acting like er capitalists, something only GW is allowed to do.

Achaylus72
21-05-2011, 16:41
As for my LGS giving me support, well i was playing in a league and came in 3rd and the club i belonged to had an awards night, but you had to notice the tiny slip of paper stuck to the back wall announcing the awards night. There was no verbal announcement of the Awards night.

So i turned up the day after and was told i should have turned up at the awards night, i said to the guy behind the counter (deputy manager) that i did not know that there was an award night, he said oh sure there was one, well had i attended i would have won a $100 gift certificate for coming 3rd in the league, and so i said i am here now so can you give it to me, they refused point blank to hand over the $100 gift certificate.

They reasoned that i had to be at the awards night to claim my prize,i spoke to other in the league almost all did not know that there was an awards night and some had missed out on gift certificates for their positions in the league, overall over $1000 worth of various gift certificate were withheld from winners of said certificates.

Since then (over three years) i have not been back to the LGS costing them $250 per month in sales that is a total of $9,000 of lost revenue.

logan054
21-05-2011, 16:49
Hey you! Stop doing that!

So I can do it...

I thought of it first :p


Seems fair to be honest.

Hardly, basically you have GW taking advantage of changing exchange rates and then turning round and saying its not ok for small companies to do it while in the same breathe charging the customer for the expense of something that will in the long run save them money (metal to resin), I am sorry but I really don't see how it's fair that just because you live in Aus, etc you have to pay twice as much as someone in the uk (who pay large amounts of vat), just away of making more money of people and acting like nothing is wrong.

Llew
21-05-2011, 16:49
Dishonest corporate spin on a business decision. They have reasons for making their decisions, and those are rooted in their business interests, yet they try to pretend that they're really doing it so they can defend all of Gamerdom.

It's beyond moronic.

1) Sell to UK dealer
2) UK dealer sells to UK buyer
3) Profit!

1) Sell to UK dealer
2) UK dealer sells to buyer anywhere else
3) No profit!

What a load of b.s.

It's not just offensive that they'd try to spin this, but that they'd be so bad at spinning it.

Trasvi
21-05-2011, 17:03
1) Sell to UK dealer
2) UK dealer sells to UK buyer
3) Profit!

1) Sell to UK dealer
2) UK dealer sells to buyer anywhere else
3) No profit!


Aha, but GW want it to be:

1) Sell to Aus dealer
2) Aus dealer sells to Aus buyer
3) EXTREME profit!

whereas its more likely to be
1) Try to sell to Aus dealer
2) Aus dealer says 'GW? that is so 2011, wanna buy some Malifaux?
3) Sad face

I do love GW's take on it tho: "Those nasty, thieving, free-riding internet stores, taking advantage of currency shifts!! Now buy from us so we can take advantage of currency shifts... err, and support your FLGS"

Gwyddyon
21-05-2011, 17:07
Over recent years, a number of currencies have moved a long way from their historical relative values, and this has opened the door for some traders to try to take advantage of these currency movements and offer deep discounts to overseas hobbyists. This has been the case with European internet traders selling to some of our customers overseas.

That paragraph sums up the crux of the issue and demonstrates exactly how little they think of their (ex-?)customers' intelligence. Currencies change. Some retailers take advantage of that by lowering prices while still making a profit. GW is mad because they want to ignore currency fluctuations that are working in their benefit by allowing them to act innocent while they essentially send prices in certain regions through the roof through inaction. Their CEO is essentially saying that GW either don't understand basic principles of economics or they think their customers are too dumb to understand basic principles of economics even if it's thrown in their faces.

In my opinion, this letter is the worst thing GW have done for their image in a long time. Utterly backfires. Now I really WON'T be doing any business with them. I may not get "a total experience" from TheWarstore or the Perry brothers, but they don't talk to me as though I'm an ignorant *****. That sort of attention to basic customer service practices counts for something.

StraightSilver
21-05-2011, 17:12
I have to say that I am normally very supportive of GW, and it is rare I speak out against them but in the last few days they have, to be honest, just gone too far.

It's bad enough that they announce a price rise of between 1% - 20% on a large portion of their products, which in this current economic climate is just incredible.

Inflation has been on average below 4% and the majority od people working in the UK have not had a pay rise to bring them in line with inflation, which basically equates to a pay cut.

And that doesn't count the poor sods who have actually lost their jobs.

This price rise is announced in the same week that they announce their fine scale minis, which are not only cheaper to produce, but also much cheaper to ship as they weigh considerably less.

I haven't bought anything directly from GW for quite some time, choosing to buy from Darksphere instead, not only because they are on average 20% cheaper than GW but also because their attitude and customer service is just so much better (no pointless hard sell for a start).

But to get back on topic.

If you read the GW financial page Tom Kirby states that GW is not a retailer. They are a manufacturer of toy soldiers, and although they do have stores these are not retail outlets but in fact hobby centres.

I think this is becoming more and more apparent as time gors by, as if they considered themselves to be a retailer I think things would be very different.

They are one of the very few UK companies to post a healthy profit last year in this fragile economic climate.

Other retailers are really struggling.

However other retailers offer deals on products such as 3 for 2 of bogof.

Other retailers also have sales at least once a year.

GW has never followed these retail trends, mainly because they have never really needed to.

They don't have any real direct competition in this market place.

Until places like Wayland and Darkspher, Maelstrom etc opened.

These places are able to have stores and an effective web presence whilst offering GW product at a competetive price.

If you look at GW's financial results last year their own high street performance is down considerably, whereas their sales to independants is significantly up. And they made a profit.

This is because most older customers buy from independents these days, and why wouldn't you.

This doesn't have such a significant impact in European territories. GW's margins are so impressive that this drop in revenue hasn't really affected them, and they still turned a profit.

However I don't doubt it has massively impacted on their profits in the Southern Hemisphere and this is why they have stopped it.

It's funny how 2-3 years ago the Australian retail model was examined as their stores were massivelu outperforming their European counterparts, and it was this that prompted the changes to our own UK retail model.

This proves there is a profitable customer base in OZ etc, but I think GW have just signed their death warrant in this territory.

Why would anyone pay ninety US dollars for a box of tactical marines? Apparently that's how much some people in the Southern Hemisphere are having to pay.

t-tauri
21-05-2011, 17:51
Thread closed. Already in the existing threads.