Wednesday, March 5, 2014

The Rise and Fall of Hobby Shops

Recently one of my favorite game shops (and by favorite i mean the only privately owned one that was even remotely close to me) closed. It's kind of a sad occasion because in this specific instance it wasn't even a case of they couldn't make the bills due to lack of sales like most other hobby shops. In this case it was a conflict with the property manager which caused the owner of said shop to decide it was no longer worth it to keep the store up and running and thus decided to close up shop of all their locations indefinitely.

So why exactly do local, privately owned game shops close so frequently? we see it so often and it's kind of disappointing to the participants of the hobbies. I am a firm believer that for whatever reason there is generally not enough activity. Unfortunately for it to be financially feasible to run a hobby shop you need to consider the market you're going to be tailoring to and then consider the largest trends in that market. You  can't afford everything under the sun so at this point you need to pick and choose what product you will stock and what product you won't. Card shops that focus on the holy trinity of card games: Yu-gi-oh, Magic and Vanguard tend to be very successful with a stable income but that income is not to the point where the company could safely make an expansion into any other market for fear of losing a large chunk of change on product that wouldn't sell. Other hobby shops tend to do alright, but most other hobbies are so incredibly expensive that the purchase rate at which these items are moved is almost detrimental.

Also, with other hobbies there are no randomized packages of items that can all be used in unison to create something successful. Generally things like Miniature War Gaming have boxes that contain only one or a small quantity of like models and they generally tend to be extremely expensive. Which leads to a lower purchase rate. Because, where you could go to walmart and drop 20 bucks to buy a deck-builder's box full of 285 magic cards and have all the essentials you need to get started in the hobby, you would need to go to an actual hobby store or a games workshop and buy a boxed army which costs 120-200, then any additional "units" you wish to purchase would range from 20-120 bucks by themselves. The investment is colossal and just that starter army is enough for a 500 point army when most regulation tournaments are run at 1500 points or 2000 points so even if you bought all starter armies and played with all the mediocre units that provides you, you'd be looking at a minimum of a $360 investment to get started.

So where does that put hobby shops? it puts them in the grave, that's where. Nobody can thrive because hobby companies hijack the prices on their product to the point where it is the epitome of a luxury item and then people shop for items from third parties with discounted prices or ebay for pre-purchased items and the same hundred thousand models get cycled except for the elite who have too much discretionary cash and too much free time. This in turn puts companies to their death.

Now granted my hobby shop closed it's doors after a long run because the dispute they were having made it no longer a feasible business model in any respect to remain open, and that's a disappointment and also an outlier in the graph of why hobby stores close. Generally they close because the primary companies price their products so that nobody can survive except for the mother shop and it's little spawn.

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