Article about GW on Yahoo Finance.

[Mr Mystery]

Spotted this whilst going to the GW site to see if End Times : Khaine was up for pre-order.

Worth a read (https://uk.finance.yahoo.com/news/warren-buffett-small-cap-may-123204137.html)

Seems to speak highly of GW in it's current market position, but expresses concerns about management.

[wayne williams]

seems like a very fair description of gw to the lay person ( non hobbyist ) sadly.

[Erik Setzer]

Clearly they're just Internet trolls hating on Games Workshop, right?

Okay, with that handy bit of sarcasm out of the way (hey, I had to, with the way article commenters on this site are)...

They're right. The management isn't really paying attention to the customers and what they want, which is causing a drop in sales volume, and the only way to try to keep revenues up is to keep increasing the prices... which in turn will just price out more of the customers. It's a band-aid on a serious issue that they're unwilling to address. Until they actually start losing money, they'll stubbornly cling to this stuff.

From just looking at the finances, it's a troubling look. Prices are up, new edition of their flagship game, lots of new expensive releases... and yet revenues were down. Expenses were down, too, thanks to a lot of restructuring (though with a laughably expensive new website), but profits dropped sharply. Those are not good signs, and not a company I'd want to invest in.

[40kGamer]

My favorite excerpt:

' There is one Warren Buffet principle that leaves the investment thesis in Games Workshop crumbling... Buffett once said: "I try to buy stock in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will" '

It is telling that GW does not discuss sales volume in its annual report. What it tells me as an executive is that there is nothing good to tell... at least that has always been the reason we leave things out of a report.

[Erik Setzer]

It is telling that GW does not discuss sales volume in its annual report. What it tells me as an executive is that there is nothing good to tell... at least that has always been the reason we leave things out of a report.

That part is pretty blatant. When you release a bunch of higher-priced stuff like Knights ($140), a lot of new codices ($50 each), a new edition of your flagship game ($85), etc., and your revenues are DOWN, that means that the sales volume has dropped.

[Wildeybeast]

"It is losing Customers that have been fiercely loyal for years". There's nothing like rampant speculation passed off as informed fact to make your point. Exactly what evidence is this based on, beyond anecdotal internet opinion? Sure, GW will have lost some people, but there is absolutely no hard evidence on how many, or more pertinently whether those numbers are outweighed by the number of new customers it is picking up. This article lost any credibility for me with that statement.

[AirHorse]

Indeed, agree about the article as a whole Wildeybeast. I was actually interested in reading a proper well informed opinion that wasn't just dumped on a forum...but tbh there isn't much substance to this at all!! Disappointing!

[daboarder]

"It is losing Customers that have been fiercely loyal for years". There's nothing like rampant speculation passed off as informed fact to make your point. Exactly what evidence is this based on, beyond anecdotal internet opinion?

probably the aforementioned decimated sales numbers....

[Wolfshade]

Indeed, agree about the article as a whole Wildeybeast. I was actually interested in reading a proper well informed opinion that wasn't just dumped on a forum...but tbh there isn't much substance to this at all!! Disappointing!

^^ Basically.

[Wildeybeast]

probably the aforementioned decimated sales numbers....

That could well be an indicator, but there is no hard evidence that people are leaving the hobby (in any significant numbers) as a direct result of GW policy. There could be exactly the same number of active customers, they could just be spending less due to the harsher economic times we live in, or any other number of factors. I'm not saying it isn't happening, or that I agree with GW's business decisions. I'm just pointing out that attempting to pass off opinion and anecdote as fact whilst simultaneously implying that GW's fall in sales is a direct result of customers being unhappy with their business decisions, without any actual evidence to support such a claim, is at best shoddy journalism and at worst grossly misleading and potentially slanderous. Again, not saying the guy is wrong, but if he's gonna makes those claims he needs to bring some proof to the table.

[Deadlift]

probably the aforementioned decimated sales numbers....

Absolutely, and I know for certain in my area players were dropping 40k quickly and switching to X-Wing. Others to Malifaux, infinity or Warmahordes. Price being the main catalyst for change. From what I read on various forums it isn't just in my area either. No matter what the article says or doesn't say, the fact of the matter is sales are going down and that's not a good thing for GW fans.

[40kGamer]

GW has lost a lot of players in my area but on the flip side other games are thriving. It may be just some cyclical thing but I've seen enough to be concerned with the overall health of the GW hobby in the local market.

[CoffeeGrunt]

Similar deal here, though the issue seems to be more about time, rather than money...mostly. I'm aiming to try and get Kill Team going as a thing because of this, as I found some good rules online for it that should be fun to try out.

I think it's a very fair appraisal of GW for the most part. They're important, though a lot of people dislike it. They're the one most people start on before diversifying or simply selling onto another game. They get people into the hobby, and without GW stores dotted around, I imagine the whole industry would find it that bit harder to grab would-be wargamers.

However, they do have a raft of issues, and it's hard to tell what the magic formula would be for profitability. It likely won't be as simple as just lowering the prices - people are complaining despite the options for 20% cuts from online resellers, and that's a lot of money lost to GW if they made that cut themselves. Hell, my local does a 10% off deal, which is nice.

Also the link in the author's name is a dead link, so it's hard to check their credentials. They appear to be part of a stock analyst firm, but the article itself is presented without a lot of intimate knowledge of the field, so it's hard to tell if it's any more informed than some of the articles on here.

As always, whenever someone mentions GW's falling profits, I ask them how Privateer, FFG and whoever makes Malifaux are doing financially. We don't get that data because they're not PLCs, and without that data, we're trying to compare GW in a vacuum rather than against its competition in a like-for-like, empirical manner. The smart money's on these companies enjoying a steady growth, but there are unseen factors that could be bleeding their profits, it could be that the entire industry is slumping, but GW is the chunky tip of the iceberg that we can see.

Never been in a community that so intensely scrutinised one of its provider's financials, though...

[40kGamer]

However, they do have a raft of issues, and it's hard to tell what the magic formula would be for profitability. It likely won't be as simple as just lowering the prices - people are complaining despite the options for 20% cuts from online resellers, and that's a lot of money lost to GW if they made that cut themselves. Hell, my local does a 10% off deal, which is nice.

Personally I think it's all about value rather than price. If people are happy enough with a product they tend to accept the price even if it is a wee bit high.


As always, whenever someone mentions GW's falling profits, I ask them how Privateer, FFG and whoever makes Malifaux are doing financially. We don't get that data because they're not PLCs, and without that data, we're trying to compare GW in a vacuum rather than against its competition in a like-for-like, empirical manner. The smart money's on these companies enjoying a steady growth, but there are unseen factors that could be bleeding their profits, it could be that the entire industry is slumping, but GW is the chunky tip of the iceberg that we can see.

We should see a slight change here. Now that FFG has been brought into the Asmodee fold we will eventually get some information on them. (Hopefully they will be treated as a separate division and at least get a line item in the public reports.)


Never been in a community that so intensely scrutinised one of its provider's financials, though...

It is an interesting situation. GW is under the microscope with the net crowd. :)

[BeardMonk]

As always, whenever someone mentions GW's falling profits, I ask them how Privateer, FFG and whoever makes Malifaux are doing financially. We don't get that data because they're not PLCs, and without that data, we're trying to compare GW in a vacuum rather than against its competition in a like-for-like, empirical manner. The smart money's on these companies enjoying a steady growth, but there are unseen factors that could be bleeding their profits, it could be that the entire industry is slumping, but GW is the chunky tip of the iceberg that we can see.



I think for a lot of people, its not GW profits or price point that so much the problem for. As a WMH player I think PP products are in the same price bracket as GW although with the new generation of plastic kits being released by PP the price has come down a FEW £'s.

I think the reason why people scrutinise GW is because of their apparent lack of customer communication and community feedback and perceived unwillingness to interact with their customer base and support the games themselves. In a void of information people crawl over any facts they can get their hands on. thus the focus on the financials. People are then extrapolating outwards from there.

For my 2p's worth I do think that GW is in trouble although I think they are more than capable of bringing it back if they interact with their customers and player base more and formally support competitive play. I love GW models and use them a lot for things such a Pathfinder RPG. But as a games company they can learn a lot from the PP model IMO.

[Wolfshade]

I think the reason why people scrutinise GW is because of their apparent lack of customer communication and community feedback and perceived unwillingness to interact with their customer base and support the games themselves. In a void of information people crawl over any facts they can get their hands on. thus the focus on the financials. People are then extrapolating outwards from there.

For my 2p's worth I do think that GW is in trouble although I think they are more than capable of bringing it back if they interact with their customers and player base more and formally support competitive play. I love GW models and use them a lot for things such a Pathfinder RPG. But as a games company they can learn a lot from the PP model IMO.

Unfortunately, this is not the perception that GW get. Whether this is through the communication that managers pass to GW central at "the coal face" or through their any of their events, like black library live, forgeworld studio events, games day etc.

[Path Walker]

People leave the hobby and always have, they move on, happens with all hobbies.

People in your area are moving on to a different game, great, people else where are moving into 40k, a new generation of 12 year olds are getting hooked. Hell, most people I know dropped the hobby completly from 18-28 while we went out and spent our money on drink and sex and now we're back because we have settled down a bit.

The anecdotal evidence of a few people you know doesn't mean diddly.

and daboarder doesn't know the sales are falling because he hasn't seen this years sales figures.

Many people are more excited about GW than they have been for a long time, between The End Times and the fun of 7th ed 40K, GW are reacting to the market and beginning to engage with its core customers a bit more, giving them things they said they wanted for ages, campagins, discounted boxed sets, white dwarf that had fluff articles and rules in it, its a good time to be a hobbyist.

[Caitsidhe]

People in your area are moving on to a different game, great, people else where are moving into 40k, a new generation of 12 year olds are getting hooked. Hell, most people I know dropped the hobby completly from 18-28 while we went out and spent our money on drink and sex and now we're back because we have settled down a bit.

You see, this is one of those "cultural" differences between players in the United States and elsewhere. We don't have a new generation of twelve year olds. We never had an old generation of them. :D In the United States this is a game played by adults. Our kids have better things to do, or at least things they can afford. Anecdotal or not, it is reliable information I'm giving you. Once in a while you will have a father show up at a tournament with his kid in tow. That is about as close as we get to children in our US version of the hobby. What this means, for sales in the United States at least, is that there isn't a new player joining for every player lost.

All that being said, Games Workshop might not care about losing the US market. Perhaps we aren't a big enough part of their sales. Perhaps they have already ceded our market and are just waiting for it to die. That wonderful CEO who just recently stepped aside might see it as good in the long run somehow. :D What I can tell you is that their strategy isn't working in the United States. Anecodatal or not, I can tell you that interest in 40K is at an all time low everywhere I go. You mentioned the core players earlier, which I find ironic because even people who were hardcore by American standards have jumped ship, i.e. people I never would have believed would give the game up.

[CoffeeGrunt]

People quit hobbies all the time, same as people quit jobs. This is because people change. I don't expect to be doing the same stuff I'm doing now in a decade's time, and nor does anyone else really. A few years ago I was addicted to videogames, and now I never play any, for example.

I'm pretty sure that there are new people picking games up all the time.

[Caitsidhe]

People quit hobbies all the time, same as people quit jobs. This is because people change. I don't expect to be doing the same stuff I'm doing now in a decade's time, and nor does anyone else really. A few years ago I was addicted to videogames, and now I never play any, for example.

I'm pretty sure that there are new people picking games up all the time.


I agree. People only stay with games that continue to thrill them. The question is whether or not they are picking up 40K or Warhammer Fantasy. That doesn't appear to be the case, at least not in the numbers to offset those moving on to other games. The simple truth is there are more games now, i.e. more competition (both inside the hobby and from different hobbies). Sticking to this thread, the question is whether this niche market has peaked. That is the only thing investors care about. Will a business continue to grow or has it peaked?

[Erik Setzer]

Referencing "the fun of 7th edition" or "the End Times" as things that say GW's going to do better is, well, silly. 7th edition didn't do much to help their sales in the last report, nor did things like Imperial Knights, which people were excited about as well. With the End Times stuff, I see a lot of people playing WFB, but not noticeably more stuff actually being sold, people are just pulling out their armies and playing again. They say they can't afford the new models coming out for it - if you skip the Spirit Hosts (kit for an existing unit) and the character on foot, the cheapest kit is $55 (and you need multiples for a realistic unit, IMO, just like with the Morghasts). It doesn't matter if the kits are nice, if people can't afford them then they can't afford them, and that's sales that aren't happening. Further, the insanely stupid limited print runs have limited sales, and by the time they get softcovers out there that are priced horribly (seriously, when they charge almost as much as they do for the hardcovers, it makes it clear that the books aren't being priced based on printing cost), a lot of people already have copied the rules they want from someone else or just downloaded a set off the Internet. And I'm having a hard time finding someone who wants to try the new spells and magic rules introduced in Khaine, so some of the shine is wearing off as people are concerned about how some of the rules affect the game (a lot of people refused to play with 50% Lords until it was errata'd into the rulebook.

So yeah, trying to fight anecdotal evidence with anecdotal evidence is silly.

The key point is that last year GW released a lot of stuff that people were "excited" about and yet sales were down. Revenues were down even as prices went up, and that means a notable drop in sales volume.

It's not as easy as price reductions. I do think some price adjustments would help a lot. I think it'd be valid to look at the line and reduce some that are priced in silly prices (Witch Elves, Space Marine characters, etc.), and just phase out some stuff (Blood Knights either need new affordable models or just dropped... but they should also get a rules tweak as well to make them seem like a better choice, sort of like mounted Blight Kings). But it'd take a lot more than that. Real customer outreach needs to exist. Reach out to the customers, engage them, get them involved more, give them "buy in." It helps you keep an eye on the pulse of the market, and also gets people more interested in buying from the company. If the hardcover books really cost so much (they don't), then drop them altogether except for limited editions. Drop the idea of being a "premium" company. Occasional collector kits or books or whatever are a good idea, but the rules especially should be an affordable way to suck people into the games and help them on their way to becoming repeat customers. If every release is a "collector" release, then the value of all of those "collector items" goes down anyway. And there's maybe 1% of their customers who even see the products that way. Even the small minority of people who just buy models and don't play games don't normally treat GW models as if they're some kind of hot commodity that's going to increase dramatically in value over time.

Basically, most of the top leadership of the company needs replaced with people who are willing to lead it in the right direction. The lower guys, like local store managers, typically have a much better clue of what the customers actually want.