Lorcana the Disney TCG: What you don't know #1
Lorcana: What you don’t know The hype is real for the game, the prices for the D23 promos are real, kind of. But there is a lot you don’t know, and it can likely hurt you. I know right out of the gates that nay sayers will just ignore me, that is the way of the world. And to be fair, the slabbed promos are likely going to stay high in value, and I hope they do. But what we don’t know is, are those cards going to be in the first set? And if so will they be different art? If the question to either of those is no, then the promos value it legit. And worst case, the card designation will be different, so there is value there, how much is the question. But this article isn’t about the value of Promos. It’s about the overall value of the first set going forward. Because stores are already starting to presell online at the MSRP of $144, and others as high as $280. This is where we start to diverge from even assessing the value of the product(s). We need to establish some base lines though, so we can make some informed decisions. Trading Card Games (TCGs) in general, never make it. Most TCGs fail. Lorcana has an amazing Intellectual Property (IP) going in. By fail, I mean they die within 2-3 years. Since August of 1993, when Magic appeared, there have been over 1,000 TCGs. You name it, it’s likely had one. The Simpsons, Star Wars (5 so far), Star Gate, 24, X-Files, Scooby-Doo, WWE, MLB, Dune, and so many more that were completely original. To establish a better picture, only 1 has made it 30 years (obviously) with Pokemon about to become the second. Less than 10 have made it past 20 years, and one of them ended at 21 years. Most of the others past 20 aside from the big 3 are essentially niche games at this point. And less than 15 have made it past 10 years, with Force of Will being the newest addition to that list. These time frames are based on the American market, there are some in other countries that have passed it, but we are looking at the potential for Lorcana to be a good investment and have a large player base, so I am using US markets, as it is also my wheelhouse. I have played MTG since 1995, have owned 5 Hobby stores, and have played more of these games than I can remember. I have seen the booms and busts, games die for all the reasons, under printed, bad play programs, loss of licensing, or just being bad games and many other reasons. I currently run 3 stores that I started by selling singles online from a tier 3 game. The only difference Lorcana has is that for once the IP and the company making it are both solid. Most TCGs in the past have had one or the other, and most failed. There are still a lot of factors to account for, but we will start with the basics. Pricing. A box of Magic the Gathering (Draft) (MTG) is around $100 wholesale but has 36 packs. Pokemon is similar, Yu-Gi-Oh and Flesh and Blood (FAB) are also 24 packs a box, but are much lower ranging from $65-$80 a box, depending on if it a special product or not. Lorcana, however, has its pricing for a 24-pack box on par with the 36 pack boxes of other games. We will call this the Disney Tax. The increased price for a booster box, compared to its competitors, shouldn’t affect the overall value too much, one has to be aware that it is higher out of the gate. For investors the price difference is of no real concern as they want it to go up in value. Collectors will likely only buy a small amount and finish collections from buying single cards after, but players might see it as a possible issue. Especially for those that just want to try it out before committing fully. Though the starter decks look to be a great way to try before you buy (fully). Now on to the potential for card themselves. Pull Rates. Lorcana: First Chapter is a 204-card set with five levels of rarity, Common, Uncommon, Rare, Super Rare and Legendary. We can likely ignore the common and uncommon. Each pack will have 2 slots for rare and higher as well as a Foil card, which could be any rarity. So, one could get 3 rares or higher in a pack. This is a good thing for collectors and players, as there are the cards likely to be worth the most, especially the foil rares and up. The unknown though is COULD you get say 3 Legendarys in a pack? Is the pack 1 rare, then an additional and higher? Do you have a chance at 2 Super rares? These are things we don’t know. If there is a chance on get 2 Legendarys in the pack AND a foil Legendary, and depending on how often this occurs, it could make them not as scarce as in other games with a high end rare. This could lead to potential lower value. Most games only have one rare or higher in a pack, with the additional chance of a foil. So, Lorcana is ahead in that regard. This will make collectors and players happy, but investors maybe not as much. But this brings us to an important thing we don’t know, the pull rates. Take MTG for example, they have Mythic Rares, the equal to Legenday. We know you will get one about every 8 or 9 packs. So, in their box you can get at least 4, not counting any foil versions. This helps to establish their value even before a set releases. With Lorcana we don’t know how many there even are, how many we might get in a box, or even how often we might get a pack with 2 or more. This can skew the value a lot. Another huge thing we don’t know, will there be chase cards? At what rarities? An Alternate Art Legendary would go for a ton more than the base version. If a card is worth say $5, the foil could be worth $7-$12 and the Alt Art could be worth $25+. Pokemon and Yu-Gi-Oh are good examples of that. These are just conservative estimates as well. Market Influence: One factor I think will also drive pricing (especially in singles) is an added market, or more like the size of it. Most TCGs have players and investors, of course there are collectors too, but Lorcana will likely have more collectors (compared to players) than any other TCG. We have no idea how this will impact the value or even the pricing of the sealed product as people who will never play and just want the cards to put in binders start snapping up cards. Just be aware of a lot of these factors going in. If you plan to just play or collect, don’t overpay. And if you want to invest, be aware that without the other two groups you will likely lose money in the long run.
Game Store Life #5: Burnout and Balance
Do you work 40 to 50 hours a week currently and make a descent wage? Say $20+ an hour or $30k a year or more? Do you have benefits? Vacation time? Take vacations? What if told you, you could work 80+ hours a week for less than half of what you make now, maybe even lose money and have no benefits, very little time off and maybe a weeks’ vacation every 3 years of so, but be your own boss? Well, then do I have a deal for you!!!!!! Open a game store. There is a real danger to opening a game store, well any small business, but more so for us geeks. Its bad health and early death. I hate to say this, but the only reason I opened my second store is because the market where it is had a fairly busy shop before mine, but the owner, nice guy and all, passed away early due to health concerns. This left an opening. I hear it all the time in my retailer groups about the long hours, low returns, and the health issues. Most shop owners get in real deep when setting up and trying to guide their business to success. Since the kind of thing, we do isn’t exactly prepping for the Olympics, well for get the freshman fifteen, we have the entrepreneur 80. You think I’m kidding? Just as your LGS owner what kind of shape they used to be in. So, long hours, bad diet, sedentary work. It all adds up, in pounds that is. Next, we have the hours. You want to make it, so you put n all the hours, and lose track of time. Then you don’t take time off because you want to be there in case anything goes wrong; this is your baby after all. Before you know it, your kids are grown, you haven’t taken a break in 27 months and your other half is packed, gone, and been gone for weeks. The worst part is, you may burnout and not even know it for a while. This is a big risk of running one of these things. I got lucky and learned not to put in too much time, or more than I had to. This doesn’t mean skate, if you do that, you will fail. What I mean is that I had to take time for myself, set boundaries. There will be times you have to put in the 100+ hours a week, but make sure its at most like once a quarter after the initial time needed just to open. There are ways to do this. Get people to help you, you don’t have to do it all yourself. Though you should do every job first and figure out the best way to do it, then write it down so whomever you get to take over knows what you expect, and you know what they are supposed to be doing. Maybe don’t take a vacation the first couple of years until you can hire a manager that you trust implicitly. But don’t skip the time off. Be closed that extra weekend around Christmas and chill out. Take time to play the games you sell. You may not be able to play in that RCQ or cash event you run, but chill out and play some casual Commander, or toss down in a local event. Have a board game group. My advice here is always play with players knowing you can’t win prizes. Just pass down anything you would have gotten to the next place. This way customers won’t feel like you’re taking from the prize pool. It also shows they know you like to play and have a vested interest in the game as well. This helps in additional ways besides relacing. You keep up to date on games and learn new ones. Sure, you can read the rules and all that, even have game days with the staff, but that’s all work related, you should play to have fun as well. The minute you wake up and dread having to go to your shop and work, you should start thinking about an exit strategy. I’m not saying the fun is over, maybe you have reached burnout and all you need is a refresh. But knowing how you will get out is just as important as knowing how you will open. How big is that loan you got to pen? How long to pay it off? You need to know how to get out and not lose your shirt. This goes back to my earlier article where I tell you not to get a loan. Because as the end of the day there isn’t a line of people wanting to buy your business. And to honest, no game store is worth more than its inventory. Though there are some assets that might make you worth buying out, it’s rare and most people can just rent a space up the road, buy all the things you sell and start from scratch on their own. If you do look to sell the business, keep this in mind. Add up all the actual stuff at wholesale cost, then knock some more money off and someone MIGHT be willing buy it if they have half a brain. This isn’t an exit strategy that you can count on unless you are planning to get out in like 5 years and list it for sale now. Just remember that on a list of things that are important, your game store is in the bottom half there. Family, time for self, health, and the like are more important, and if neglected can lead to even less time at your store because you are mentally done or just dead. The best way to take care of yourself is to not open one of these to start with. Thanks again for wasting your time with me.
Game Store Life #4: It’s the Little things
Are you detail oriented? If not, then stop thinking about a store of your own. It’s always the little things. You have to be borderline OCD, or even OCD to do this gig. I mean anyone can do the big stuff. What you’re going to carry, where to get your money, what kind of look you want, how to decorate, what to pay employees, all the general stuff. What about toilet paper? How will customer dry their hands? What kind and how much packing materials do you need for your online selling? How much of it? Here is an example: Local sports card shop does a lot of online sales, he rented the front of my store a while before moving out on his own. I pop in one day and he’s coming back from the post office. He packs tuff, then takes it there and mails it out, paying full price for shipping. I have a site I use to get discounted shipping. Now that might not sound like a big difference, and per package it isn’t. But when you do 10+ a day and they need tracking the amount for full price can be like $4.50 and discounted like $3.60. $.90 times 10 times 7 days is like $63 a week, so $250 a month. That’s 2.5 boxes of MTG, that can go for just over $300, making you $50 in profit. The margins in running a game store are tight, and a $50 profit you roll right back in and it helps to grow. And this is just a basic example. If you get down to every way that one can waste money in this business we would be here for a War & Peace type of thing. Another biggie is snacks and drinks. They are normally the highest profit margin item in a store. Sure, they don’t make a lot overall, but they can add a nice little chunk to the till. Do you let employees get them for free? If so, how many? Sure they don’t cost much, but each missed sale adds up. A box of 50 chips at Sam’s Club is like $19, charge $1 each, that’s a $31 profit. Not your clerk ate 4 today, that’s $4 gone. I’m not saying don’t be stingy but it’s something you have to factor in. Do you use Ultra Pro top loaders to mail out orders? Goo for you. I use the cheap ones. Want to know what I never hear? People complaining that I used the cheaper ones. But a case of the cheap ones is about $85 while UP is over $100. This also goes for the half dozen types of envelopes you’ll need, the penny sleeves, and all that. You need to keep sipping costs down, cleaning costs down. I mean don’t cheap out on the shop itself, but there are a lot of ways to save a buck here and there. Most owners I know will just grab things while they’re out, and that’s fine if you need it now. But thinking ahead and planning all the mundane expenses will not only save you time in the long run, like auto ordering on Amazon, but money as well. This goes back to my last article on having a system in place. I know, beating a dead horse. But having a cycle when you order, even if you don’t need it, will save time and even make it easier for others to do it if you get too busy. I always get the stuff when I have the money, because you might not have it next month when the new Pokemon set drops and you need more packs. Having a surplus of things that you use regularly is never a bad thing, unless you don’t have the room, but you should have that small are or storeroom to keep it all. The worst thing is having a busy week of online orders and running out of envelopes…… Here is one no one thinks about. Your local Post Office only has certain types of priority boxes or envelopes. BUT they will deliver them to you for free if you order online. I love the padded envelopes, but they are not carried locally. So, I order a couple hundred whenever I do need them. I have stacks around. They are great for single booster boxes. It’s these kind of little things that can get you. So plan ahead. And this also goes back to researching. When in the process of looking to open, these kind of questions to other owners could save you a lot of Money, but most people never ask them and have to learn the hard way. Nickle and diming your way to profitability may seem tedious, but it’s the most consistent way of doing it. Games and expansions come and go, and you never know when one will flop, and it could mean a few months of less expendable cash. This is where more than a few shops bite it. They go in on a set more than normal trying to make it off that, but then it flops and they go under. Having saved up cash could save you. Bit that is another topic for another article. Thanks for wasting your time with me again,
Game Store Life #3: Cardboard Life
If you are still planning on opening a store, still don’t. Sorry for the delay in this one, it takes a while to get to an article when you have to run a lot of nerd spaces. But I think that helps to lend credibility to me. One thing you have to note is that when you have a game store you are actually running 2 or maybe 3 businesses. The picture above is of half of my back room, the card part. I deal mostly in Force of Will and its singles. There are over 220,000 sorted singles in that picture and another 300,000 bulk/overstock. That takes a lot of time to do. Now imagine you deal in MTG, 30 years of cards and almost a new set every month. You’d need a space 10 times as large as this to keep it sorted. Now add more games. You might want to be a board game store instead, cool. You’ll need this much space as well to hold your extra copies of games. In either case you’ll need an online presence, so that means’ you’ll need a place to print, pull, and pack your orders, not to mention all the stuff to do that with. More expense. A store that wants to make it needs to be online. Even if just to let the community know what you’re doing, where you are etc. And if you’re online, why not sell? You’d be losing a lot of opportunities to make some money if you pass up on that sales channel. My main webpage doesn’t bring in a lot of revenue, I can’t justify the cost of advertising for it. But targeted ads and word of mouth will let people know you are there and make some sales. It’s kind of like free money in a way, though there is work involved. I have a Point of Sale (POS) system that integrates with my website, so I don’t have to list every item more than once or in more than one place. I use TCGPlayer to list my singles, so another sales channel. That makes 3 if you include my store itself. Thing is I have clerks for the store, someone who ust deals in TCGPlayer orders and I do the website stuff myself. The accounting is fun too. The whole point of all of this is that each thing needs a system, and they take work to put into place. A funny thing I have noticed is that a lot of people that have stores like to put in a ton of work at the start, setting up and all that. But when it comes to doing more work later, they kind of shrug it off. Each system needs a lot of work, whether its sorting 400,000 cards, organizing hundreds of board games to make grabbing them easier, or even listing each item into a new inventory system. Thing is, when the work is done, it should make the overall system operate better. The picture I used is actually the third configuration for my back room. The other side of the room is where I take in all new arrivals and inventory them for my stores. Then I have shelves for each other store’s products to be taken to them. Each distributor has its own way of doing things, this includes free shipping tiers. What has this to do with anything? Everything. I have smaller stores, so making those free shipping amounts can be hard sometimes. Since that is the case I order for all 3 stores and have them shipped to my main store. This is for a couple of reasons. I have the room at the main store to store things, I can make the free shipping most of the time, and my other managers live nearby so getting them their stuff is easy. Because of this I am able to not require a lot of space at stores 2 and 3 for storage. And since they aren’t that far I can run things out to them if I need too. I adapted my system to include the free shipping tiers of wholesalers. Thing is, each time I opened a store I had to rethink how I was doing things and come up with a way to optimize that system, then do it. I see a lot of stores do things like they have from the start, and if that works for you, then cool. The point is, don’t be afraid to adapt and do the work if it makes your business better. If you want to sit back and relax after you open and not do as much, if not more work than you did when you opened to adapt when needed, then just don’t open. When I opened it was just me and my kid running the place. I didn’t use the very front of my space because the stairs to our play space made it hard to see up there. I was losing valuable retail space, but it was a high-risk shoplifting area. So, I just put a couple of tables up there and left it. As I grew and added lackeys, I rethought the layout and changed it. Here’s a pic of the old front. It was not the best use of space, but it worked for what I had at the time. Now it’s a lot more open (excuse the mess, we’re having work done). It took a lot more work than one would thing to rearrange everything and move all the merchandise around. But in the end, it is a lot more open, easier to see things, and for people to browse. I even lost display space, I offset that with some rolling displays. Totally worth it though. Thing is, there are shops I go to that look the same as they did 5 years ago, and I can think of many ways they could optimize their space better. I think they are just afraid to do the work. This is where the 60+ hour weeks will come in. But I can tell you, once that work is done, you can relax more and just do business. I’m not saying you won’t be putting in just as many hours, but in those cases the hope it that it will be selling things and making money, which is totally worth it. But to reach those good long work weeks you will be required to have the bad ones where you bust your butt doing the more unpleasant things. And this is after planning. I didn’t just move all my stuff around. I had to think, plan, measure, schedule help, it took longer to get ready to rearrange that it actually took to do. And this was a simpler thing. If you redo your inventory management, storeroom organization, or even recount all your singles to make sure counts are right, it may take a lot longer in planning and execution. But hey, welcome to having a game store life. D. Rowland Owner CCGPrime.com
Game Store Life #2: The odds are against you
So, in my last article I said if you are thinking of opening your own store, that you shouldn’t. Most game stores fail within 2-3 years, and by most, I mean around 75%, give or take as there aren’t exactly a lot of studies on this type of industry. If you are still feeling that itch though, I guess more details can be given to try and convince you on why you shouldn’t do it. The main one out of the gate is under capitalization. If you’re going to do it, have the money to do it. I don’t just mean the money to by the stuff, but also the money to operate for at least 6 months at a loss. Here’s the kicker, I have no idea what that number is, no one really does. Here are so many variables such as location, size, target demographic, what kind of store you want to be, how many people you’ll have to pay. For our purposes though, let’s look at a simple example. A 1000 square foot space in a medium sized city. We’ll keep the number simple just for the example. Say it’s $1000 a month rent, utilities another $500, and you’re going to run it yourself for free for a while because you have a regular job. So, $1500 a month overhead. We’ll say in this case the $500 covers electric, internet, insurance, and all that jazz, again keeping it simple, and if you ask 10 shop owners 9.5 of them could only dream of it being this cheap. Now, your profit margin is usually between 25% and 40% depending on brand, shipping, ect. This is straight profit after cost of goods (COG), we’ll just say it’s 30% for this example to keep it easy. So, to cover your monthly overhead of $1500 you need to gross $5000 a month. That is your target number at the 6-month point. Sounds simple? Sure, but this is as low as you can go. You’re going to want $6000 in the bank to cover those first six months of operating expenses. You’ll also need deposits, so there is $1000 for the landlord, and likely another $500 depending on utility companies, security system, or whatever, again keeping it simple. We’re at $7000 now and haven’t even put anything in the place yet. Now go buy some fixtures, even if you go bargain hunting, that will be at least $3000, then all the incidentals, cleaning supplies, snacks, toilet paper, and all that, another $1000. So, you’re $11000 in and still have to get stuff to sell. Let’s say you have nothing to bring to start. Minimum of $25000 in inventory. We’re at $36000 now. The usual consensus is that you need a minimum of $50000 to open a small shop, and that isn’t counting cash reserves. Even if you have stuff set aside to sell. You can try for a bank loan, good luck. Better have a good business plan and even then, you likely won’t get it. Funding is hard to get and even then, terms are not usually the best. Avoid going to family or friends, that will end poorly. It’s also a headache. I borrowed $3000 from family to open my second store (I had all the stuff to put in it already) and that was semi-sloppy, and I just needed it for deposits and signage. That is just a basic idea of how much it will run you to get started, and that is a low estimate for a hypothetical situation. For our next example, and I think the biggest, we will address the gamer that opens a store. How can that be a bad thing, you ask? I will tell you, and by gamer, I mean someone that opens a store to game. I am a gamer, but when it comes to my stores, I am a business owner. When I say a gamer opening a store, I mean they are also a gamer when working in said store. Issue one is that they use the store and its money to get stuff for themselves. This takes away from the business side. Especially, if they want product that is heavily allocated, as has been the case these past couple of years. A new Pokemon set comes out, the store can only get 18 boxes and the owner keeps 4 for themselves. That is a loss of say $120 a box to the store, so $480, the loss of the $160 profit in not a huge deal, but the $320 loss in product is bigger. This causes 2 issues: 1) people will know your place never seems to get enough product and will go where they can get it 2) the store is losing money, it had to sell over $1000 in product to get the $320 to buy those boxes, now that’s all gone. There are ways to make this work, I mean I do this, as in I pay myself in product, BUT I pay cost for the stuff I take. In other words, I reimburse the store for what I take. The other thing I do is never take stuff that is hard to get. If an item is allocated the store gets it first, if I do get it, it will be from a restock later down the road. The business always comes first. And what I do get, I order extra to cover my wants, so the store never lacks for that product. The 3rd thing is bad reasoning or poor planning. This is when someone opens a store to run the other store or stores out of business. This can be with intent or just ego. If there are other stores in town and you just don’t want to have one far away, that is a bad reason. If the current store upset you and you open out of spite, you will lose 99% of the time. You need to know competition, even if they are competition, and what they do to succeed. Most store owners are usually more than happy to talk with you. And if you are planning on being a board game café, while the other shop in town is all card games, you can not only avoid stepping each other’s toes, but even work together in a way to help each other. Not everyone has to be a competitor, even if there is a little overlap. This isn’t Wall Street, there is no need to be cutthroat. The 4th thing is a total lack of knowledge. Even if you read all the business books out there, it still isn’t enough. I have only been able to find 3 books that relate to this industry, and a couple of others that could apply. I learned a lot, and I have a business degree. Also, talk to everyone you can meet that knows about this stuff, and join groups on social media and learn. This is a long process, even with years of planning, most will still fail because they missed something major. One of those things is wholesalers. I am in groups where people only have 2 or 3 wholesalers, and others that wait to apply for accounts AFTER they open. Getting an account is a process and having to pay rent while waiting is just silly. These are things you need in place before you even sign a lease. I have over 25 wholesalers and am always looking for more. The lease is another thing, people usually sign it because they are excited and don’t know any better. A commercial lease is open for negotiation. Make sure you aren’t getting the bad end of the deal. Lawyers are good here, and expensive, add that to your start up costs. But it may save you headache in the long run and even money. A 4th thing that is kind of minor is the atmosphere one has at their shop. Is it going to be a business or a hangout? There is a balance to be had here people can show up and have fun, but this could also lead to cliques that could alienate others. Just noting this here, but if the owner is just hanging out with their friends, then the word will spread, and a lot of new faces won’t come in. All the reasons I covered here are not complete by any means, in fact each of them could be their own multi-part series, but I am keeping it simple to make the points. I may revisit down the road and add more detail, but most will get the general idea. There are other basic reasons a swell, like burnout. Unless you have a perfected system, how ever long you are open each week, plan to add 50% more time to your schedule to run the place. There are a lot of after-hours stuff that needs to be done. This can be alleviated by hiring people, not just workers, I mean accountant, social media person, etc. But this adds up fast and unless you have the money to sink in or have started off making a good profit (which is rare) then a lot will fall on you as you assemble your team and just learn the best way to do a lot of these things. From this point out I will be mixing articles from talking about how I am going about setting up my new store (a real-world example) to more general informational articles like this one. That’s it for today, ran a little longer than I thought. D. Rowland Owner CCGPrime.com
Game Store Life #1: Keep your Dreams in your Pants
Game Store Life #1: Keep your Dreams in your Pants So, I wanted to write something that has to do with opening a game store, as it seems to be the latest craze. Since I am about to open my 3rd in my small chain it seems that I might qualify as someone who might know a thing or two about doing it. I run CCGPrime and I opened my main store in May of 2021, then added #2 in Dec of 2021 and the third should be open by May of 2022. This isn’t my first rodeo either, I had a store in NC from 2007 to 2012, a second for 2 years and was a partner in one in SC. I learned a lot from that first experiment and have applied it to my second outing as a game store owner. To be clear from the start though, my first set of stores didn’t fail in the business sense, they still paid for themselves, I was just tired of running them. It was too much like a real job and I wasn’t excited to do them anymore, so I sold them off and moved on. This new adventure is something totally new and I am approaching it different. With all of that said I want to start right out with the best advice about opening your own store, don’t. I’m not a hypocrite for saying that. 75% of game stores fail within the first couple of years, even if run by people who know a thing or two. I will go over some of the reasons that they fail, but needless to say I am an outlier when it comes to opening store. A lot of my stuff doesn’t apply to 99% of other owners, and thus I have an advantage that most don’t. If you are still thinking of opening a store, still don’t. There is an adage about game stores: How do you make a small fortune from running a game store? Start with a large one. This business has tight margins, you don’t make a lot of money, and even those that make a descent amount have a lot of other things that have to come out of pocket, like insurance (for US based stores), and taking time off for yourself is a huge risk, as not being open can hurt the bottom line. Back to me, cause why not? I am a retired veteran so I have a steady income, I have health coverage from the VA, and I can walk away from my stores whenever I want as I am pretty much debt free. I have a degree in business, I am the sole owner, and I have my nose up the industry’s butt to sniff stuff out. I also have been lucky enough to open my places where there is little or no competition. If you want to start a shop within 20 minutes of any other shop, then just stop right now. Established stores (5+ years) know what they are doing and won’t worry about you. Most people that start a store are inexperienced, underfunded, are usually set on what their store will carry and have a way that they are going to run it. You have to KNOW a lot of things to open a store, and I mean a lot more than how to run a register and order stuff. You are going to have a lot of expenses you didn’t know about or realize, and it piles up. If you run your store like a gamer, collector, or a clubhouse, then just keep dreaming and save your money. I think one of the main reasons stores do fail is that they are run my gamers. What I mean by that is that people will run the store and still have a gamer mentality. I am still a huge nerd and act as such when I can, but when it comes to the business, that is how I treat it. Most gamers don’t know when to switch hats and that ruins them. Yes, this article will be nothing but me telling you not to do it. Because it is hard and most fail, and the lucky ones will fail and just go on with their lives, the majority will be financially ruined, and maybe more depending on how they got their funding. Don’t get a loan from a bank, you’ll be lucky if you do to start with, no one understands how this business works, especially those in finance, heck most new store owners don’t know either. The key is research, research, and more research. Then when you think you know enough, stop and do 2x more research. You need to know the market you are in, the demographics, market research, which is hard because there isn’t much that’s done in this industry. Think being next to a college will be good? Maybe, but students are always broke. You’ll need 10x the normal number of customers if you were in a descent suburb. This endeavor is a money sink. One of the common reasons of someone getting ruined is that they don’t know when to stop. The sunk cost fallacy: The Sunk Cost Fallacy describes our tendency to follow through on an endeavor if we have already invested time, effort, or money into it, whether or not the current costs outweigh the benefits. People think that if they put in just a little bit more, stay open a little bit longer, or do one more thing that everything will be okay. Well, most of the time it won’t. You have to know when to walk away. There is a reason that most other owners tell new owners that they might be profitable within 2-3 years, it’s a slow process. There is also a lot of terminology you’ll have to know. If you don’t know about turnover, turn rates, cost of goods, wholesale, SRP, MAT, and about 500 other terms, then you have a lot of work to do and that is just to be ready to start doing the actual research. If you haven’t lived in the area you want to open and haven’t been part of the local nerd herd for a couple of years or more, then stop and move on with your life, especially if there are other stores there already. Be ready to quit your job and go all in or be sturdy enough to do 40-50 hours at a regular job and then at least 60+ more at the game store. If you have a someone that can help you, cool, but you better trust them with your money. And don’t tell me you trust them with your life, I have trusted lots of people with my life before, but I wouldn’t leave a dollar alone with them. It comes down to putting in the work before hand, having a plan to start, the funds to start, and the will to succeed. And not being an idiot helps too. Those are topics I will cover later in this series. But for now, the best I can tell you is to NOT DO IT!!!!!!
