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#34: The Game Isn't the Only Thing

st_gulik

Ben Woerner - WunderWerks
Validated User
Hippopotamus Rex said:
Good for you. I have three full time buyers to manage my inventory here. 26,000 thousand active SKU's in my system. Of course I wouldn't expect a store to be carry even half that. But let's say they just carry 10% That's 2600 items. You're going to knock t hat out on a Monday? OK. Even assuming that you do now you've turned one or two invoices into 50 or 60. A week. Extra. And you think that's good business?
Have you ever worked retail? I'm thinking this is where you might be failing at your analysis. My store has an active inventory of roughly 2300 items, you wouldn't think that in a jewelry store, but it takes a lot of rings to fill up the space of one book. I seriously doubt that my friend who owns the game store in North Phoenix has either that much or more. Yet, I don't think he's BUYING and INVENTORING and STOCKING 2600 items EVERY DAY. I've helped him unpack his shipments from his distributors and you know, even if he got ten little boxes from a bunch of different people instead of two HUGE boxes it's still the same amount of Product that he's dealing with!!!

So how's it more difficult? Oh, yeah, shorter simpler invoices from several vendors instead of one big long complicated one from a distributor. Have you ever worked in Accounting and entered and payed invoices? I do it every day, and trust me, entering in ten short simple bills from ten different suppliers into Quickbooks and paying them is a HELL of a lot easier than sorting out one HUGE ASS bill from our Single Distributor.

When you actually have some revelent experiances to share about this industry, not the jewelry industry, I'll be listening.
Oh, my apologies, I didn't realize that we had to be working directly in your job description to comment on it. But then that'd be like me Demanding you have a College Degree in English (one of the ones I have) before Writing anything, but then I'm not an Ass.

Once again, we're talking about the games industry, not the jewelry industry. I don't care about your experiances there. Yes, there are generalizations that run through all distribution channels. But that's not what the issuse here is. It's Ross making wild claims about distributon in the games industry that are not true.
I thought the issue was that you never reasonably answered any of his charges except to say you know how many SKUs you have in your warehouse right now.

Well, good luck with that.
That's the whole point.

Cock and Bull story? Whatever you say. Look it's simple. Your personal experiances about not getting product do not policy make. Especially when one of the companies, Games Workshop, isn't in distribution in any sort of large capasacity. They pulled out sometime around '95. And Privateer has been running behind on production since WarMachine launched. ACD has been upping numbers on initial releases since the game came out. It wasn't enough. We were ording upwards of 20 times our preorder numbers. At some point you have to stop rolling the dice like that.
And THAT right there is your problem! You're rolling the DICE!? You're Guessing!? Taking things on Chance!? Sure Privateer is an exception to the Rule (Their growth has been crazy these last few years), but what has happened to Forcasting, and trend watching and actually having someone who understands product looking things over and saying whether or not something is worth it.

When I purchase new product for the store here I don't care how fancy your digs are, or how much money you spend on impressing me, all I care about is the product, your ability to get it to me, and all for a low low price. If you don't have someone doing that for each and every area of gaming (cards, books, minis, board games, etc.), someone's who's sole job is to tell the numbers people back up top what's going to do well and by how much then I have a great used Ouiji board that might work out better for you.

We don't charge interest for our net customers. Find a better rate then that. And publishers in this industry don't offer net terms. So if you buy direct you can pay with a credit card, or get it COD. COD tags run $8.50 right now.
Designers in Jewelry didn't start offering any sort of terms until the Distribution model started collapsing either. That's why when a retail store applies for credit these days with a designer they fill out a form to show who else they have credit with, their bank account numbers, and available balance, business license numbers and all that jazz (which you probably know), just so the designer can be sure that it's not some flybynight here today gone tomorrow outfit.

As far as you're not charging interest to your net customers...that's the general practice. You give them 30 or 30/60/90 or 30 less 2% within 10 with no interest during the time of those terms. There are, of course, about a 100 different ways to offer terms but those three I just listed are the most common, the second being terms our store gets for being a Very good customer to some of our better designers.

But if I can deal directly with one Publisher and get them to give me Net 30 and give him everything he needs in terms of proof of my credibility and then actually pay him when I say so, then I don't see why it can't start happening elsewhere.


And that's assuming the publisher in question will deal direct. Most will, sure, especially the smaller ones. A lot of the medium sized and larger ones will not.
Matter of time. White Wolf is a pretty large Publisher, and they have a fancy schmancy online store on their website, and they can't see dealing with Retailers directly? I was going to say WotC, but then they're owned by a Toy Distribution Company in the First place....


Like I said, good luck with that.

Do you really think that we are sitting back with a Mai Tai laughing about how we take our cut for nothing? Like we're the Gaming Mafia? ACD is constantly looking for new services to offer our customers. New and more efficent ways to do business. We're not running around do our buying and selling with a legal pad and a pencil like has been suggested.
Do you honestly think I'm sitting in a cave somewhere with Che banners and Chairman Mao posters telling my Comrades that we are coming for the Imperialist Distributing Fascists?

Everyone just wants what's best. I think that the Distributors, however, have started to become outmoded with modern technology (making it easier for me to enter bills, email vendors, and do all the other things I do all day). The problem is that, as Upton Sinclair put it:

"it is difficult to get a man to understand something when his salary depends upon his not understanding it."

I'm sure that Ross is a great guy. He just doesn't know how this end of the industry works.
And the more you post the more I think you don't understand retail. (See my comment about not moving 2600 SKUs every week)

And as far as my view goes, well you have no idea how it goes. Because the only thing I've said in this thread is that Ross's ideas about distribution are incorrect.

And in responce I've been told that I don't know what I'm talking about, that i even don't know what my ICP can and cannot do, from someone who won't name their sources and someone whose dad owns a jewelry store.
Correction, someone who works with Inventory, Accounting, and 63 different Vendors everyday in the Number #1 Jewelry Store in our Immediate Market, and has done so for years, and was raised around it going back to my Great-Great-Great Grandfather (Harry's Jewelry and Optometry in Kansas City pre-WWII). SO don't tell me I don't know how Business Works. I bleed Business. I knew the ins and outs of this Business before I was out of High School, and I took 5 Years off and worked in OTHER Business Fields just so I wouldn't be Myopic about how Things Work in Regards to Jewelry. Things are different in Every Industry, but the more things are different the more they are the Same.

I've never claimed that distribution is perfect. I know there is room for improvement. There always is. And the fact that the last two years have been the worst I have ever seen for the industry adds to everyone being a little cranky I think. Yes, I get defensive when see people slamming distribution. Because they usually have no idea what they are talking about.
I'd still like you to answer the questions Ross posed about why direct publisher to retail vending is worse than distribution.

I'm happy to answer any questions about what do here and how we do it. But please don't sit here and tell me I'm wrong when I say something about how we operate. We've spent a lot of time, effort and money at ACD to make this company an industry leader. We've risen from just another regional in the late 90's to the second largest distributor in the country. That doesn't happen because of a sense of entitlement, and that's what seems to be suggested here. It happens because we are bringing a service to the industry. It happens because retailers and manufacturers alike see value in using us.

Like I said in a previous post, there will always be distributors, but there are better, more convenient, more efficient ways coming that will replace distribution models. Maybe your ACD company will be the Distributor that sticks around, who knows, all I'm sayin' is that Distribution is not the end all be all that it thinks it is, and it, as Ross says, can be improved or replaced, or both.

One last response to you last sentence. Have you ever thought that they use you because you're the only game in town? If all the grocery stores all offer the same substandard service, people will start going to the farmers' market more, or they'll just get used to the substandard service and expect it...kind of like the Soviet Union during the Cold War.
 

Munchezuma

Hooray!
st_gulik said:
One last response to you last sentence. Have you ever thought that they use you because you're the only game in town? If all the grocery stores all offer the same substandard service, people will start going to the farmers' market more, or they'll just get used to the substandard service and expect it...kind of like the Soviet Union during the Cold War.
Well, to be fair, you have to acknowledge the converse - they could use them because they are better than the alternative (be it another distributor or dealing direct).

I understand distribution takes its cut. I am okay with that. Why? Well, lets start with the aforementioned WotC and WW. They will not deal direct. Add to that GW, where distribution allows you to circumvent their outrageous (for my situation) terms.

Given the number of publishers whose products I sell, I quit long ago trying to find who would deal direct. Why? I expect when I order something that I should get an invoice that is not hand-written on a piece of plain white paper (It was actually thermal paper too for some odd reason. And yes, it was with the past 18 months). I also expect to have the phone answered, and to not hear "Can you hold on while I look for a pencil and something to write on."

No thanks, I'll choose distribution.
 
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