Tuesday, January 17, 2012

The Cost of War…

Over the past few years the cost of many things has steadily increased, and like all industries the Board Game industry has saw a number of increased costs in both raw materials and in production. So what does this mean for us gamers?

Well, it means our hobby is becoming more expansive, it’s becoming harder to fund our microcosmic wars, and support our diminutive armies.

The biggest example of this lately has been the ever increasing price for DUST Tactics and Tannhauser, now before I say anything negative about FFG or all the hard work they’ve put in to these games; let me say as someone who works in this industry, I fully understand and sympathize with their position.

Now, a little history... When AEG (Alderac Entertainment Group) first handed DT over to FFG they did so because: “…our commitment to our players to only take on games we can fully support and our commitment to our partners at Dust Games to make sure their games get the attention they deserve.” That was a pretty vague statement, but reading between the lines, it’s easy to infer: (We can’t afford to support this game and make a reasonable profit.), and in the end this is always the problem, can we make a profit.

A small company like AEG must make far more profit per item then FFG and that is why DUST Tactics originally changed hands; to save it so DUST Tactics wouldn’t be another AT 43 and AEG would not end like Rackham.

So, why does the price still go up?

Well, simple, the profit margin has to stay the same even if the production cost increases. When the DUST Tactics and Tannhauser Core Set were originally released the costs of production were much lower than today. Let’s look at Tannhauser, in 2008 when Novgorod was released and originally printed the MSRP was $59.95. Now, fast forward to 2011 and the release of the Shogunate which was release piece-meal and for a total cost of $88.75, a 33% increase, which is roughly equal to the increase in production costs. That kind of makes sense, but does not make any sense to me right now it this.

While the cost of production and future products has gone up 33% the cost of past products has remained the same, Novgorod still sells for $55.95, not $79.95. Why is that? Frankly I’m not sure. It would seem to be logical to spread the cost increases across all products as a whole rather then only on the newer ones. I suppose it’s possible that the initial production runs are so massive that there has yet to be a new printing of Novgorod with the new increased production costs. If that’s the case we should see a sizable jump in the price of older products in the near future.

I could go on for hours theorizing about FFG’s corporate strategy, but it wouldn’t be fair, I don’t work for them, and to be honest their more recent pricing schemes seem to far more in line with industry leaders like Games Workshop or Battlefront Miniatures.

Well I hope that helps some of you better understand what’s happening in our industry today. Please leave any questions or comments below.