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Consumer price vs Store price
Author
Hi all,
With my game close to release (my first big title), I am actively trying to get toy stores to buy my game. However, does anyone here have an indication of how much you could ask them?
Of course it''s lower than the consumerprice as they have to make a living, but how much lower?
I can understand shops wanting a good margin since a lot of software ends up getting dumped in ''almost free'' bins after the first few months. Does this affect the price?
Assume I want to sell the game directly to consumers (over the web, small scale) for $20. What would I then reasonably ask a shop (assuming they''d also sell it for $20)?
Thanks for any pointers as I did''t find anything in the FAQ or the latest 30 days posts (search is offline )
)
I think you actually have to pay the shops to distribute your product, and it can be a few thousand Apologies if I''m wrong.
Apologies if I''m wrong.
Author
In my situation, I am contacting the stores directly, and talk to their purchase department. Clearly, if they are interested in selling a product (any product) they will buy an X amount from the factory/seller/distributor/whoever and put them in their stores.
So I do expect to get money for the number of products they buy from me, yes. (There is no publisher 'middleman').
If you are really sure it doesn't work this way, correct me... (Might this also vary in different countries?)
I'm not sure how common special arrangements are, like: do they get a right to return unsold items? (Something I don't really want since I'd probably not be able to sell them then either)
[edited by - megmond on September 29, 2002 12:44:18 PM]
So I do expect to get money for the number of products they buy from me, yes. (There is no publisher 'middleman').
If you are really sure it doesn't work this way, correct me... (Might this also vary in different countries?)
I'm not sure how common special arrangements are, like: do they get a right to return unsold items? (Something I don't really want since I'd probably not be able to sell them then either)
[edited by - megmond on September 29, 2002 12:44:18 PM]
You could try to give the game to the store for free and come later to see if they sold some copies, then you ask them the money. You could make some kind of contract to avoid being fooled. Anyway I think you have better chances of selling it over internet.
Author
xaxa, if it was an individual store I''d certainly do that (give them a few copies to put on display, and allowing them a part of the selling price). However, as you say, the internet is then probably an easier choice (I will also use the internet for sales myself).
Perhaps I should have said ''chainstore'' to make it clearer. I will shortly contact two major chainstores (their purchasing departments) here in my country. They both have between 100 and 200 outlets throughout the country.
I''m hoping they will be interested and put maybe one or two copies in each store so effectively I might sell 200-300 copies ''in one go''.
(fast replies here though!
Perhaps I should have said ''chainstore'' to make it clearer. I will shortly contact two major chainstores (their purchasing departments) here in my country. They both have between 100 and 200 outlets throughout the country.
I''m hoping they will be interested and put maybe one or two copies in each store so effectively I might sell 200-300 copies ''in one go''.
(fast replies here though!
It's really not just as easy as calling a retail store's sales office and asking them if they would be interested in buying direct from you.
Megmond, you need to get some more information about retail, distribution, and publishing. You'll probably be shocked by what most distributors expect from publishers. (And you effectively are the publisher)
To just answer your original question though... As the "publisher" you may get 10-30% of the final retail price. You won't set the retail price, the distributor and retailer will.
Michael Sikora
www.GuardianLightStudios.com
[edited by - guardian_light on September 29, 2002 2:07:45 PM]
Megmond, you need to get some more information about retail, distribution, and publishing. You'll probably be shocked by what most distributors expect from publishers. (And you effectively are the publisher)
To just answer your original question though... As the "publisher" you may get 10-30% of the final retail price. You won't set the retail price, the distributor and retailer will.
Michael Sikora
www.GuardianLightStudios.com
[edited by - guardian_light on September 29, 2002 2:07:45 PM]
Are you sure of those figures? That must mean that when going through a publisher other than themsleves, developers must make a pitance.
Author
quote: Original post by Guardian_Light
Megmond, you need to get some more information about retail, distribution, and publishing.
Actually, I have been around for a while, and have researched all these issues. I know the difference between developers, publishers and distributors. I came to the conclusion that the best way to go about this (in my specific situation ) was to do it the way I initially explained.
I know it won''t be as easy as calling up a store and offering my product for sale and then getting an order. I am aware of all things concerned, and I am really only looking for an answer to my initial question.
I know it''s not a great chance I have of selling my product directly to the stores I am targetting, but it''s definately not a lost cause and I''m just looking to ask a fair price initially.
And Razza: the figure Guardian quotes is quite on target (AFAIK). Normally you have a chain that goes developer-publisher-distributor-store. The developer then often ends up with 10-20% (again, AFAIK) of the actual retail price. But this takes into account of course that publisher/distributor/store provide a lot of services (i.e. they market the game, produce it, have shelf space, etc.)
Since I don''t know the details within this chain, I asked my initial question. So I guess you can also read it as: What percentage of the retail price does a distributor charge the store for a (software/game) product.
Distributor can add any thing from 10% - 50%.
If you are distributing games (or any product for that matter) yourself, a minimal charge can be 15%. If you want to look professional here's the math:
Developer: You get what you can negotiate.
Publisher:
- Packaging + CD duplication costs
- Shipping and handling
- Add what you think you need to make (at what your projected sales are to reach your revenue target) For example, if you need to make $20 000 on this particular product and you expect to sell 5000 units, add $4 per product cost.
Distributor:
Add at least 15%.
Retailer:
Add 40-60% (or more!)
Add up the figures. Don't round your sale price. (if it's $5.43 per copy, that's what you charge the retailer.)
An example:
$2.43 for CD and packaging,
$0.77 shipping for each. (bulk)
$4.00 for required revenue target.
Publisher charges: $7.20
15% of $7.20
Distributor charges: $8.28
Finally, retail adds 60%
Consumer cost: $13.24
Finally, a retailer will make it a suitable consumer price:
$13.99 or possibly $14.99
For the sake of credibility, I've signed publishing agreements and know what a developer makes. (10% of retail is about right!) The actual percentages vary, but there is more to know about publishing yourself.
ie. Most major retailers take 30 - 120 days to pay AFTER they receive the product(s).
Many developers on this board could confirm this information. Information like this could be added to the FAQ possibly?
Michael Sikora
www.GuardianLightStudios.com
PS:Megmond, I didn't intend to imply you didn't do the homework. Good luck ;-)
[edited by - Guardian_Light on September 29, 2002 6:39:38 PM]
If you are distributing games (or any product for that matter) yourself, a minimal charge can be 15%. If you want to look professional here's the math:
Developer: You get what you can negotiate.
Publisher:
- Packaging + CD duplication costs
- Shipping and handling
- Add what you think you need to make (at what your projected sales are to reach your revenue target) For example, if you need to make $20 000 on this particular product and you expect to sell 5000 units, add $4 per product cost.
Distributor:
Add at least 15%.
Retailer:
Add 40-60% (or more!)
Add up the figures. Don't round your sale price. (if it's $5.43 per copy, that's what you charge the retailer.)
An example:
$2.43 for CD and packaging,
$0.77 shipping for each. (bulk)
$4.00 for required revenue target.
Publisher charges: $7.20
15% of $7.20
Distributor charges: $8.28
Finally, retail adds 60%
Consumer cost: $13.24
Finally, a retailer will make it a suitable consumer price:
$13.99 or possibly $14.99
For the sake of credibility, I've signed publishing agreements and know what a developer makes. (10% of retail is about right!) The actual percentages vary, but there is more to know about publishing yourself.
ie. Most major retailers take 30 - 120 days to pay AFTER they receive the product(s).
Many developers on this board could confirm this information. Information like this could be added to the FAQ possibly?
Michael Sikora
www.GuardianLightStudios.com
PS:Megmond, I didn't intend to imply you didn't do the homework. Good luck ;-)
[edited by - Guardian_Light on September 29, 2002 6:39:38 PM]
I don''t know much about this but I''d have to guess that they sell the game at LEAST at double the price they buy it at. Otherwise they can''t make a profit.
This topic is closed to new replies.
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