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Darth Sanguis

Concerns about exclusive distribution rights/future of Armada

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So I was discussing a store championship event with the owner of one of the game stores I frequent when the owner mentioned he was unsure about about the future of Armada due to a deal signed by FFG(ANA) giving exclusive distribution rights to Alliance. He said it was possible nothing would change, but that this distributor was well known for raising prices over it's competition. He continued to say many hobby shops immediately decided to pull ANA products. 

As someone who's fairly new to tabletop gaming, I can't really gauge the threat or lack there of. Star Wars Armada is really the only tabletop game I have played. 


I was hoping some of the more veteran folks on the forums could tell me what this means for the future of Star Wars Armada at the brick and mortar level. Is this going to change the availability of products, raise store prices, or is this just a non-issue where nothing will really change?

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It is likely just people's aversion to change. The internet is great at getting upset over things.  Centralized distribution ensures some areas don't get screwed due to favourtism, etc, which I'm assuming is the ultimate endgame here that Asmodee was working at.  We've apparently had some distro issues in Canada with certain things from LR or somesuch.

Companies don't just award exclusivity and say run with it, there are terms and conditions, guaranteed. As Asmodee had tightened up releases to be set date, they likely are trying to support that reality by tightening up on distro to guarantee it can drop as planned.  

Also currently this is US only.

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11 minutes ago, Darthain said:

It is likely just people's aversion to change. The internet is great at getting upset over things.  Centralized distribution ensures some areas don't get screwed due to favourtism, etc, which I'm assuming is the ultimate endgame here that Asmodee was working at.  We've apparently had some distro issues in Canada with certain things from LR or somesuch.

Companies don't just award exclusivity and say run with it, there are terms and conditions, guaranteed. As Asmodee had tightened up releases to be set date, they likely are trying to support that reality by tightening up on distro to guarantee it can drop as planned.  

Also currently this is US only.

Thanks Darthain, it's a relief to hear. 

I figured this may be the case, but I have very little experience in these areas to lean on lol 

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46 minutes ago, Darthain said:

It is likely just people's aversion to change. The internet is great at getting upset over things.  Centralized distribution ensures some areas don't get screwed due to favourtism, etc, which I'm assuming is the ultimate endgame here that Asmodee was working at.  We've apparently had some distro issues in Canada with certain things from LR or somesuch.

Companies don't just award exclusivity and say run with it, there are terms and conditions, guaranteed. As Asmodee had tightened up releases to be set date, they likely are trying to support that reality by tightening up on distro to guarantee it can drop as planned.  

Also currently this is US only.

From reading LGS owners and employees online, this is not aversion to change, but aversion to a bad distributor that has a record of playing favoritism, large order minimums and raising the cost of products. I am relaying info here, not making claims as I am just a consumer. I will say that exclusive distribution is hardly ever a good thing for consumers.

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Alliance has a habit of picking up exclusive distribution rights (everything Catan and Carcassonne comes through them, for example) and for the life of me I couldn't tell you how. As a company they're subpar and our orders from them are regularly missing something or have a damaged item or two.

I'm not peeing myself over it, we're just going to deal with it and move on. If I had to guess as to why Asmodee went that route, I'd guess Destiny had something to do with it. With various different distributors trying to get inadequate Destiny supplies to different game stores, you got a very uneven distribution that was fairly ad hoc, as many game stores use more than one distributor and so all of them were trying to max out their Destiny allotment from every distributor they used. It created have and have-not stores and stores with no idea if they could fulfill their preorders until the day of. Very confusing and frustrating. With just a single company handling distribution, it seems like we may have a more even Destiny distribution in the future instead of the raw chaos of how it has been. Maybe. I still don't like Alliance, but we'll see.

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15 minutes ago, Snipafist said:

Alliance has a habit of picking up exclusive distribution rights (everything Catan and Carcassonne comes through them, for example) and for the life of me I couldn't tell you how. As a company they're subpar and our orders from them are regularly missing something or have a damaged item or two.

I'm not peeing myself over it, we're just going to deal with it and move on. If I had to guess as to why Asmodee went that route, I'd guess Destiny had something to do with it. With various different distributors trying to get inadequate Destiny supplies to different game stores, you got a very uneven distribution that was fairly ad hoc, as many game stores use more than one distributor and so all of them were trying to max out their Destiny allotment from every distributor they used. It created have and have-not stores and stores with no idea if they could fulfill their preorders until the day of. Very confusing and frustrating. With just a single company handling distribution, it seems like we may have a more even Destiny distribution in the future instead of the raw chaos of how it has been. Maybe. I still don't like Alliance, but we'll see.

This is all about Asmodees business model.

 

The ultimate goal here is not "highest customer satisfaction" or "fairness" the ultimate goal is Vertical Integration they want to own everything from publisher down to store so they can control the entire market. They started by buying many major publishers, then they embarked on a strategy of consolidating exclusives to those products in a distributor they want to buy, recently they have been buying distributors. Basically what they do is pick a crap distributor and get them "addicted" to exclusives and then vigorously encourage them to sell. They completed this strategy in Canada with F2Z (now known as Asmodee Canada).

The next step in their plan, once they get stores buying all their stuff from distributors they own, is to force stores to stock a particular number of Asmodee group owned titles or be cut off. For a lot of stores this might represent a stomach-churning amount of their shelf space/inventory. Then they do the same thing as with the distributors. Don't be surprised to see Asmodee branded LGSs in the next few years. Vertical integration is a powerful tool in the homogenization and monopolization of an industry. They want to do this and then jack up prices to make their stock really attractive when they IPO.

 

 

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15 minutes ago, Hastatior said:

This is all about Asmodees business model.

 

The ultimate goal here is not "highest customer satisfaction" or "fairness" the ultimate goal is Vertical Integration they want to own everything from publisher down to store so they can control the entire market. They started by buying many major publishers, then they embarked on a strategy of consolidating exclusives to those products in a distributor they want to buy, recently they have been buying distributors. Basically what they do is pick a crap distributor and get them "addicted" to exclusives and then vigorously encourage them to sell. They completed this strategy in Canada with F2Z (now known as Asmodee Canada).

The next step in their plan, once they get stores buying all their stuff from distributors they own, is to force stores to stock a particular number of Asmodee group owned titles or be cut off. For a lot of stores this might represent a stomach-churning amount of their shelf space/inventory. Then they do the same thing as with the distributors. Don't be surprised to see Asmodee branded LGSs in the next few years. Vertical integration is a powerful tool in the homogenization and monopolization of an industry. They want to do this and then jack up prices to make their stock really attractive when they IPO.

Sounds like how GW has run things in the past.

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Can't knock it if it works.  

I hated GW for years (still do) because of their business practices but apparently I'm the fool as their stock price has doubled over the past year to the highest it has ever been since they IPOd in the 90s.

I was willing to bet money the Age of Sigmar was going to be the beginning of the death of GW.  But according to their filings its already vastly more profitable than the old fantasy line ever was.

Indeed I am curious how the Asmodee master plan plays out.

Don't forget that Asmodee is actually owned by a french private equity shop, who will want an exit on their investment so Asmodee going public is a very real possibility over the next couple years.  Which I would really be in favor off if only to satisfy my curiousity to know how profitable a board game company actually is.

 

 

Edited by PartyPotato

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5 minutes ago, CaribbeanNinja said:

Very interesting. As much as I love some game stores, I would welcome a FFG mother-ship style store near me. 

Don't be so sure of that.  We have a store here that is pretty close to an FFG "mothership-style store" as can be currently, and it's worse than the more independent ones.

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5 minutes ago, SoonerTed said:

Don't be so sure of that.  We have a store here that is pretty close to an FFG "mothership-style store" as can be currently, and it's worse than the more independent ones.

Well, I'll just say that I'm very impressed by the Roseville, MN store. 

Adequate space

Well stocked and manned. 

Food and beer.

Beer. 

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Just now, CaribbeanNinja said:

Well, I'll just say that I'm very impressed by the Roseville, MN store. 

Adequate space

Well stocked and manned. 

Food and beer.

Beer. 

I will admit if they stock the Mexican Coca-Cola ( the kind made with cane sugar instead of that nasty corn syrup) I'd be there with bells on.

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I think you guys are blowing this out of proportion a bit. I work for a pretty dominant distributor in an other specialty retail market that is significantly larger than the board game business and there's hardly enough money in it to warrant a vertical integration at the level people are concerned about.

What you're seeing is the concentration of manufacturers, distributors, and retailers due to the effects of online sales. Shops that can't keep up with the dot-coms are closing down. Distributors are scrambling to figure out how to survive with fewer customers. Manufacturers are trying to decide whether to make a quick buck now (sell online without any price controls) or protect their brands and potentially limit short term sales (MAP and online sales restrictions).

Exclusive distribution is lucrative to distributors but can also break them if they lose it. If you're not happy with the distributor, send those complaints to Asmodee. If they get enough complaints they'll either request the distributor to change or find someone willing to do what is good for their product.

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58 minutes ago, SoonerTed said:

I will admit if they stock the Mexican Coca-Cola ( the kind made with cane sugar instead of that nasty corn syrup) I'd be there with bells on.

My LGS has a Latinx grocery store with a food counter across the parking lot, and coolers full of those sodas with real sugar.

 

Honestly, it would be a mixed bag if Asmodee/FFG moved in that direction. GW stores were awesome if for no other reason than you had experts on the games, great terrain and regular events (at least the four or five that used to be near me). LGSs can be so very hit or miss - they range from professionally run with people who know the game and keep the place clean to the stereotypical anti-social angry nerd who uses it as an excuse to hang out with his friends and lord his mighty power over people (these are the stores that are always dirty, and have that distinct smell).

 

The other issue a lot of LGSs suffer from is a lack of focus. There are so many games out there that the LGS community can be broken down into tiny parts that makes it hard to find players for a given game. This is opposed to (for lack of another comparison) a GW store where it's only these specific games. In the first instance, things are so fractured that it can be very difficult to get a large group together for a single event, but it also means you can usually find at least one or two people for **** near any game system to play against. The second instance means it's easy as hell to find people who play that store's/company's games (40k/WHFB/specialist games when they had them), but you're out of luck if you want to play anything else.

 

If they do it with a light touch, I could see it being very beneficial. And by "light touch", I'm talking one or two stores in a state like Massachusetts, one in a smaller state, and maybe a few more in the bigger ones like California or Texas. It serves as a bar to measure gaming stores against (that is, IF they make sure they're run professionally and have proper training), are obvious places to host major events like Regionals (which would again raise the standard for tournaments - I've been to great ones and terrible ones), and if they're not overdone won't interfere with the LGSs too much. If you have one FFG store in the greater Boston area, it won't have much of an impact on the LGS scene (especially considering that GW and PP and a host of other games wouldn't be played/sold there). But if they go all GW and open a store literally down the street from an LGS in a tiny city like Holyoke and then open about five more in the same state, well. . .that could cause problems.

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I used to love the old GW Store we had near me. I spent a whole summer as a mallrat teen playing the WH40k learn to play scenario about a zillion times because, well mostly cause it was free and I was a poor teen, but also because the shop was in an outdoor mall and they had a killer looking demo table setup out front of the store that you could play on that was just so cool looking it always drew a crowd. You could munch a hotdog and kill some alien stuff, all with a sweaty nerd who was little too into space marines narrating the whole thing for the onlookers.

I never bought a thing, but I think back now that I would officially call myself a "miniatures gamer" and see that it was that summer out front of the GW Store that really primed the pump for me, so to speak.

If Asmodee can create a place that fosters that kind of experience for my kids and their friends, I would still call a price increase a win. A begrudging win that causes my wife and bank account to cry out in pain, but a win none the less.

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6 hours ago, BiggsIRL said:

I know that my FLGS owner is unhappy about this change.  I think he prefers getting ANA/FFG products from a different distributor.

But he said on my end it will be business as usual.

I was having the exact same conversation with my FLGS owner last night too. It seems a common theme, annoyed at the distributor change but otherwise will continue to sell.

With all the negative views about the distributor in question, sure seems odd that ANA would make the change they made. 

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10 minutes ago, tgall said:

I was having the exact same conversation with my FLGS owner last night too. It seems a common theme, annoyed at the distributor change but otherwise will continue to sell.

With all the negative views about the distributor in question, sure seems odd that ANA would make the change they made. 

I thought I read an article that said Alliance made a large investment to get this contract...



"Asmodee cited a “significant investment” by Alliance to communicate, support, and allocate ANA products, which it said will “provide hobby games retailers with the support and inventory they need to successfully grow their business selling Asmodee’s games” as the reason for the change.  That support will include a dedicated team of Asmodee sales specialists at Alliance."

https://icv2.com/articles/news/view/37650/asmodee-north-america-goes-exclusive-alliance



 

Edited by Darth Sanguis

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I only say this to provide some clarity - not all shops fit the mold I describe below:

Again, working at a prominent distributor in a different specialty retail market it is not uncommon for me to hear shops complain about our performance/offerings/treatment of them. Oftentimes it is the result of a change in the way we do business that does not explicitly benefit them but the change often occurs because of them - a common example is freight/ordering.

Our company offers 2-day shipping from four warehouses to about 95% of our customers. To support this we need orders to be about $500 - any less than this the cost of simply picking, packing, and shipping the order will be greater than the value of the order and we lose money (we also attempt to remain freight neutral, it isn't in our business model to profit on freight). To try to quietly support this we offer freight breaks at right around $500. It is our dealers who most often fail to submit a $500 order than complain about our freight limits. It is completely logical for us to want/need to stack the deck against a business that submits multiple sub-$100 orders in a week when they could've saved up their orders and submitted just one that got them free freight and allowed us to make some money.

Now this is just one example of what drives distributors to do business the way they do. We've got a pretty sophisticated freight system so I have to imagine for many game distributors their costs are even greater and therefore request more of their customers. The same way you can't expect your FLGS to offer you below-cost on all your purchaes, that FLGS can't expect their distributor to lose money on their orders.

As for why distributors exist - think about the last time you went to the mall. The mall, while potentially more expensive, or less enjoyable to shop at, presents you with the opportunity to get everything you need at once.  This saves you time and effort and the owners of the mall deserve a cut of the pie for making the investment to provide you with convenience. Maybe absolute cost is more important to you and you have the time to stop at and shop at multiple locations - then do so, nothing is stopping you the same way nothing is stopping retailers from going straight to publishers/manufacturers (I realize this isn't always the case, some manufacturers will only sell through distributors).

 

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