It's been almost exactly a year since my last post here, but I'm back for a one-time only update on the state of Reiver Games, me and a brief retrospective on the five years of Reiver Games.
A Year! What's Happened?
Since I last posted here I've been trying (successfully :) ) to get back into paid employment. After a brief spell of work experience working for a previous employer in Newcastle, I found a full-time role in software development (my official trade) near home and I've been doing that for the last seven and a half months. I'm nearly back to full steam, relearning those skills I'd learnt in the eight years before I quit coding to try Reiver Games as a full-time concern. The job is going well, they seem to like me and the work I'm doing, and I've got to say I'm loving getting a pay-check every month. It's awesome :)
Bored Now. What About Reiver Games?
Reiver Games has been very slowly ticking along in the intervening twelve months. I cut the prices of the games I had on consignment at distributors in the UK and the US in an attempt to get rid of them so all my stock was in one place. It worked, I sold the last games on consignment at the beginning of this year.a
That left me with just over three thousand games left in my warehouse (and my office): predominantly Sumeria, but with a decent chunk of It's Alive! and Carpe Astra too. Plus about 600 copies of the 2-player expansion of Sumeria. I've been trying to sell these to liquidators over the last few months and getting little traction.
About a month ago all that changed, Tanga.com got back to me (I'd assumed at that point that I'd heard the last from them) and agreed to take 300 of each game (and 300 expansions) to sell in the US (so if you're in the US they should be arriving in about two weeks...) and with that sale I could afford to sell the rest to a UK liquidator for a laughable amount. Between the two they should just about pay off my bank loan, so I can close the company down and pay off my creditors without having to dip into our personal funds.
I've got about a dozen games left at home (the loose ones I couldn't sell to a liquidator) that I'm selling on my website at pretty much cost plus shipping. Once those are gone it's just the final 300 copies of the Sumeria expansion, and then I'm done. I'm thinking of sending the remaining expansions to BoardGameGeek, so that at least they should find loving homes :)
You Rich Enough To Retire?
Sadly no. I don't have the exact figures, but I reckon I lost about £13,000 ($19,000) on Reiver Games. Dear God, that sounds awful. The one slight redeeming feature is that the vast majority of that was some money we came into unexpectedly (which was the only reason I could afford to invest in the company and not earn anything for two years). I say again: Earning a wage again is awesome.
What Went Wrong?
Clearly I screwed things up. How? Can I at least provide some pointers to the intrepid among you to help you avoid my mistakes?
Firstly, I made the jump from hobby publisher to professional publisher too soon and too quickly. The games I made by hand were very successful - I sold out of both print runs within a year and pretty much doubled the investment both times. 100% ROI is pretty good going. But that was selling a few hundred games mostly direct to gamers, not selling thousands predominantly to distributors and shops. Rather than rushing into things, I should have continued to make the games by hand and sell them to gamers at conventions, while building up my reputation and stable of games. Once I had a strong reputation and 5-10 games under my belt, I should have moved to a half-way house, where I got the games professionally manufactured in much smaller print runs (500 - 1,500) but still sold directly to gamers - that way I could afford the high costs of small print runs, since there were no middle men taking their cut. The fully professional model could come later, once I had a bunch of awesome games with a proven track record and a wider reputation. This is similar to the model Martin Wallace has taken with such success (though clearly it helps that his games are extremely popular).
My second mistake was around print run sizes and manufacturer choices. I decided to get the games manufactured in Europe for three reasons: it would be easier to liaise with the manufacturers, the environmental cost of shipping the games to me would be less than from China, and I knew that working conditions and materials would be of a known high standard. I was very happy with the second manufacturer I used: LudoFact in Germany. Their customer service was excellent. The production quality was excellent. They delivered on time and as budgeted. Sadly, getting the games manufactured in the EU cost me, as the unit cost was significantly higher, which both raised my retail price and squeezed my margins. In an attempt to overcome this problem, I increased the size of my print runs to reduce the unit costs. This left me with me with more games than I, as a new relatively unknown publisher, could sell. As a result, the capital I needed to invest in new games was instead sat in my warehouse as unsold stock, and even worse, it was costing me money to warehouse it there.
Mistake number three was related to mistake number two. In an attempt to get retail prices to an affordable level, while still selling at 40% of retail to distributors I squeezed my margins too far, to the point where I was making nowhere near enough money on each game, and yet still the games were expensive, especially in Germany (where they had to compete with local manufacturers doing vast print runs) and the US (where they had to compete with local manufacturers doing much larger print runs and getting the games made in China). With high prices people were less likely to take a punt and see if they liked it, so sales were lower than they needed to be. Making the games in the smallest box I could fit them in, while popular with collectors with huge collections and saving money on shipping, also made the games look even more expensive when compared similar sized games in the shops.
Finally, there was the bank loan. The bank were very happy to lend me £10,000 to get Carpe Astra manufactered, just after It's Alive! was released. It's Alive! was several months late, due to problems at the manufacturer, and with my pitiful margins had hardly recouped any of its investment when I wanted to release Carpe Astra. It turns out that the bank made a good decision: I'm going to re-pay the loan in full a few months early. Sadly, it was a terrible idea for me. I was paying £330 a month servicing the loan, which meant the money I was making month in, month out was quite rapidly disappearing from my account, leaving me little to invest in new games. In hindsight, I should have gone more slowly as discussed above, without having to rely on a loan. If I really wanted to jump straight in at the deep end of selling to distributors, then I needed a much larger initial investment, probably on the order of £50,000 - £100,000 - enough to fund five or ten games without relying on external finance.
It probably shouldn't be the last point, but I also needed a much better understanding of marketing and a solid marketing strategy. Considering how little I knew, it's a wonder that I managed to sell 5,500 games worldwide before the end.
I'm proud of what I achieved during the last five years with Reiver Games. From a pipe dream of making a board game in Newcastle eight or nine years ago, I sold four games (8,500 copies in total including the liquidators), to five of the world's continents. I got my products into 21 distributors in North America, the UK and throughout Europe.
I really enjoyed the graphic design and learning new skills in sales and marketing and dealing with manufacturers, distributors, shops and logistics. I loved going to trade shows and conventions and introducing gamers to my games.
I'm really glad that I decided to go for it, and that The Wife gave me her unconditional support. Had I not done it, I'd be financially better off, but I would not have learnt everything I did over the last five years, nor would I have met so many gamers who share my passion for board games.
I'd like my last words here to be a huge thank you to all my customers (thanks again for your support), all the gamers I've met (thanks for your enthusiasm), the designers (including those who sent me games I didn't publish) and my friends and family (especially The Awesome Wife) for your support, encouragement, advice and for not treating me like the lunatic I clearly am. I'll leave this blog up, hopefully the information contained herein will provide information, advice, a cautionary tale and entertainment(?) for other wannabe designers, publishers and entrepreneurs.