"I'm not sure that I think it's gonna be around in 10 or 20 years"
July 17, 2017 10:28 AM   Subscribe

Polygon has a long post with some lovely photographs that goes into the details, costs, and struggles of running an independent game store in 2017.
posted by Pope Guilty (24 comments total) 20 users marked this as a favorite
Your sanity.
posted by Fizz at 10:39 AM on July 17, 2017 [2 favorites]

I just find it amazing that Amazon is selling video games at below the price the stores can buy it from distributors. Game publishers need to watch that. Amazon could get big enough in games distribution to start to demand a lower price, similar to what they tried to do with ebooks.
posted by zabuni at 10:43 AM on July 17, 2017 [4 favorites]

I'm a bit surprised that Ctrl-F for "steam" didn't turn up anything.
posted by Halloween Jack at 12:00 PM on July 17, 2017 [2 favorites]

Someone should trademark "BUY SELL TRADE", then sue everyone. You could live off that revenue forever.
posted by blue_beetle at 12:28 PM on July 17, 2017

Why would it? The article's about stores that sell console games. It definitely mentions buying games online (both in physical and downloadable form), but Steam's not involved.
posted by asperity at 12:30 PM on July 17, 2017 [2 favorites]

I got all excited thinking this was going to be a (possibly long form) piece on table-top/board games type indie stores.

That said, I only play PC games (not console), and in the last 4 or 5 years I've pretty much only bought from Steam (except Diablo 3 directly from Blizzard). I guess that makes me part of the problem.
posted by BigHeartedGuy at 12:52 PM on July 17, 2017 [3 favorites]

I feel bad for the few genuinely independent stores in this field.

My personal experience, though, was that the only game shops I've ever bought physical disks from were either big box stores like CompUSA or chains like GameStop/EB. So, to me, very little of value of was lost when Steam took over PC game distribution.
posted by tobascodagama at 1:08 PM on July 17, 2017 [4 favorites]

There were some shops here in socal that would mod your ps1 (and I'm sure other systems) and then rent or sell you imported games, which at that time was a big deal because a lot of games would come out earlier in Japan than the US. Brings me back to the days of using a paper clip to boot a US game, then switching it with a Japanese disc. Tekken 3 a month early! Also trying to figure out the menus in a Robot Wars game and erasing my memory card :(
posted by Huck500 at 1:13 PM on July 17, 2017 [4 favorites]

Local game store just got seized for non-payment of taxes.

posted by mikelieman at 1:20 PM on July 17, 2017

It's a rough business. I've stopped in to a few independent video game shops, but they never seem to have anything I want to play right then, and they have trouble keeping their leases, so at least the ones I've encountered tend not to stick around long. It's the sort of store I'd have to visit regularly to find something I wanted. Mostly because what I want is not old sports games.

The decline of the buy-console-games-in-a-dedicated-store business model is even making me feel a tiny bit bad for GameStop, and I hate that company. Even the used games part of the market's getting thinner, with BestBuy, Target, and probably other larger stores now offering trade-in programs.

I'm also not interested in buying relatively recent console games without cases because of how often they're outright stolen or just being sold by some other family member without the owner's input (still basically stolen). And GameStop's destroy-the-cases policy for anything but current systems makes distinguishing stolen goods even more difficult.
posted by asperity at 1:31 PM on July 17, 2017 [4 favorites]

I just find it amazing that Amazon is selling video games at below the price the stores can buy it from distributors.

Nothing new about that :) Don't you ever see people in grocery stores with carts full of pop? They are convenience store owners stocking their shelves. My Mom used to run a wool shop during the previous knitting boom, back in the mid-80s. Department stores of the time (think K-Mart) would routinely have sales where they sold popular types of Patons and Baldwins yarn for below her wholesale cost.

And that's not even getting into the obscenity that is franchising. My sister worked for a print shop franchiser in the late-90s. She'd be sent to the local Future Shop (now Best Buy) to buy scanners that were then sold to franchisees for double what they cost in the electronics store. Tim Hortons Franchisees in Canada are in the middle of a fight over this right now.

Our economy is full of scam, and it has been for a long long time. That makes this a fantastic article, though, you rarely get such a detailed glimpse behind the curtain.
posted by Chuckles at 1:40 PM on July 17, 2017 [9 favorites]

Why would it? The article's about stores that sell console games. It definitely mentions buying games online (both in physical and downloadable form), but Steam's not involved.

Steam might not be involved, but it's definitely a cautionary tale. Throughout the 80's and 90's I shopped at a variety of PC-centric video game stores, both chains and indies. Places like Target and Best Buy had decent-sized PC game sections. By the mid 2000's Steam was starting to sell games that weren't made by valve and the rest is history - you just don't buy physical copies of PC games anymore.

Physical copies of console games can be traded and resold and that's the only thing keeping these stores alive. If they're not out of the new games biz by now they will be soon because of the margins. If Microsoft had its way with the XB1 licensing system they'd be out of business as new product retailers already. As is, they're more like specialized pawn shops than retailers and that trend will continue. And as time moves on and NES cartridges get more and more aged, they'll have a bit of antique store to them as well.
posted by thecjm at 1:54 PM on July 17, 2017 [3 favorites]

I'm a bit surprised that Ctrl-F for "steam" didn't turn up anything.

There are several reasons why this might be the case. First, PC games have predominantly been new sales for a very long time. In the modern era with most games hooking into Steam or an equivalent online service requiring a product key, used sales are non-existent. Barely any indie game stores thrive on new video game sales.

Normally that might be worth a mention as a contributing factor to why these stores no longer sell PC games. But PC games have been missing from North American game stores since well before Steam became really popular. As the market shifted towards consoles like the PS2, it became harder and harder to find PC games at video game meccas like Gamestop, never mind places that didn't specialize in games but sold a selection of them in their electronics departments. You can still find robust PC gaming retail displays, but they're mostly in Germany now.

There's a weird third reason, but I'm not actually sure it's true, it's more conjecture on my part. Now that retro gaming is in, you'd think that might open the door to selling PC games from the 80s and 90s--the ones that wouldn't have any online DRM and thus could actually be resold with less trouble. The boxes are gorgeous. They're also humongous.

So the third reason might be shelf space: for games old enough that they can be resold, there's just no room to stock the in the store, and for games new enough that they came in smaller boxes or DVD cases, they also require online activation and thus can't be resold. Incidentally, the size of PC game boxes back in the day might also have been a contributing factor to why retail stores started stocking fewer and fewer of them in the first place, back when they were new, but now I really am just talking out of my ass and who honestly knows.

In general, I love the idea of a used PC video game store, but I imagine the atmosphere of such a store to closely resemble the plastic model hobby stores I occasionally went to as a kid, where the owners were all fifty-year-olds with bushy moustaches and an uncanny knowledge of British warship camouflage patterns and N-scale railway company logos.
posted by chrominance at 2:02 PM on July 17, 2017 [4 favorites]

My take on Steam is that it was actually in large part a response to trends in the retail market that were already under way.

Console games can be resold multiple times. PC games cannot. It is far more profitable for retail outlets to stock console games than to stock PC games, and this has been true for decades.

Creating their own online distribution system allowed Valve to ride out that wave and keep the PC market intact.
posted by tobascodagama at 2:05 PM on July 17, 2017 [1 favorite]

Physical game stores seem to have stayed alive in the post-Steam world by doubling down on used console games... but I think there's writing on the wall for that market, too. Most console owners I know buy games digitally through their consoles' integrated stores, which run sales regularly. I'm sure the used-physical-discs market will be with us for a while, but from what I can tell, the trend for consoles is toward a Steam-type situation not too far down the road.

I'm a stubborn mostly-physical-disc person myself, but I'm getting more shy about buying used console games these days because games are starting to tie more and more content to non-transferable digital accounts. I bought a used "Game of the year" version of a popular game recently that included both the base game and lots of expansions that had been released for it. When I installed it, I discovered that all the expansion content was in the form of digital DLC's that had already been claimed by the previous owner (and tied permanently to their account). Not that big of a deal, but it's just another incentive to just buy the digital version during a sale, and not bother saving a few bucks on a used physical copy.
posted by Byzantine at 2:14 PM on July 17, 2017 [3 favorites]

Steam might not be involved, but it's definitely a cautionary tale.

Good point (and I was being unnecessarily cranky).

As is, they're more like specialized pawn shops than retailers and that trend will continue.

This is absolutely true. I felt bad for the person in the article whose state holds used game stores to pawn shop rules and whose business suffers for it, but I also feel bad for the person whose friend or relative trades in their games without permission, comes into a store looking for those games, and the games are long since sold.
posted by asperity at 2:17 PM on July 17, 2017 [2 favorites]

I tried to get a job at an independent video game store in the 90's. They told me that girls don't know anything about video games. I haven't visited one since.

And, to be honest, even the so-called "big-box" retailers like Best Buy can't compete with Amazon. My mother got Breath of the Wild for mother's day and she asked me to play it, but we got one of the broken, first-run controllers that makes Link do whatever the hell he wants every few minutes. My mom needed a new laptop so we popped into Best Buy so we could get that and a new Switch controller. The sales associate spent half an hour crawling around in the security cage looking for the one laptop they had in stock that matched the model my mother wanted. Meanwhile no store employee could find the 5 replacement controllers they supposedly had in stock. Somewhere. While we stood around we had to endure sales associates straight up lying about how Windows 10 works. According to them you can't get Windows 10 to work on a laptop that isn't a touchscreen. Yeah, whatever.

So we ordered our products from amazon and got them two days later. It used to be that you'd go to a Best Buy or a game shop or what have you for instant gratification, customer service/community, and/or sales. If the retailers can't be bothered to compete on those aspects, fuck 'em.

The article indicates that used is where it's at. Fine. I don't buy or play used console games, so I can continue to not visit local game retailers.
posted by xyzzy at 2:19 PM on July 17, 2017 [10 favorites]

In general, I love the idea of a used PC video game store...

Console games are easy to repackage. Carts are sturdy, and the CD/DVD boxes are standard and durable. Manuals are kinda optional, and it's easy to know what should be in the package. Piracy (your competition) is almost nonexistent.

Each of those things is the other way for PC games. You're right the boxes were kind of stupidly large, but they were often pretty flimsy too. In my experience, after install, diskettes wound up at the bottom of a drawer or the back of a caddy and the box went in the trash. (Or like, the box had an outer sleeve that went in the trash immediately.) Diskettes weren't that durable, and CDs came in paper sleeves. Manuals were less optional and probably there was a quick reference card that should be in there, or even some weird kind of copy protection thing. Even if you have all three disks labeled 1/3 to 3/3, are you sure there's not a separate install disk, or a utilities disk of some kind? And PC piracy was widespread even before the internet.
posted by fleacircus at 4:04 PM on July 17, 2017 [1 favorite]

I buy my games online because I don't want to be bothered with having a physical disc to unlock the stupid copy protection to play the game. But in exchange for that convenience I pay more for the games. The Playstation Store, for instance, regularly sells games online for $10 or more than the cost of buying new on Amazon.

The bigger problem with online game purchases is the customer gives up the right of resale. I can't sell my game to a store to re-sell used when I'm sick of it. I can't even loan it to a friend. It sucks. It's the same problem with Kindle books.
posted by Nelson at 4:57 PM on July 17, 2017 [2 favorites]

Amazon could get big enough in games distribution to start to demand a lower price, similar to what they tried to do with ebooks.

Amazon *is* big enough to demand a lower price. That's how they do it, for the most part.
posted by Candleman at 5:45 PM on July 17, 2017 [1 favorite]

Eh, I got "Beyond Good and Evil" and "Never Alone", for $5.00 recently, and "Sentinels of the Multiverse plus expansion pack" for $20.00 on Steam. They downloaded quietly in the background while I did other stuff. I also downloaded Pokemon Go and play it on my phone. Game stores can't match that- they're basically external combustion engine cars in a hybrid internal combustion cars world.

The RPG plus board game stores that have survived have done so by focusing on externalizes: providing places to play, selling miniatures, providing painting demonstrations, etc. They've teamed up with companies like Paizo's Pathfinder Society to promote gaming. Hell, Endgames put in a coffee shop. But it's extremely difficult for video game shops to do that- even without missteps like sexism on the part of store clerks.
posted by happyroach at 12:22 AM on July 18, 2017 [3 favorites]

We used to make some money of used PC games 5 years ago, but games were mostly cheap - most games were like €1 to €3, and we had a bin of 50c games, mostly really old DOS games in jewel cases (look, if it had a box, it wouldn't make it past this guy right here) or the really shitty magazine covermounts. It was at the same time schools started having pushing students to have laptops, and suddenly there were a lot of school kids who could skip lunch one day, and buy some shitty FPS for the price of a coke and a panini.

"There are times where we'll order a $60 game and a week, maybe a week and a half later it'll be down to 40 bucks."
One of the things I started doing at a point was trying to predict that curve. While we didn't have to be concerned with buying new (the only new stock we had were accessories), we had to take into account people that could buy some shitty game for €10 from amazon, and because it was a new release, we'd have them at €20 in credit. I think Kane and Lynch 2 was a case of that, at a point we had like 5 or 6 of collectors editions (not that we cared; most of those are just DLCs on a piece of paper, and we always sold with the assumption they were spent), and we lost money on all of them.
Another problem was getting ahead of sports titles dropping in value before online became the lead feature. We were constantly getting screwed with people offloading their games and re-purchasing them a month later for half that. I recall with FIFA 08 and 09, at a point we were losing anything between €1 to €8 on each sale. Then the next year I had price-changing rights and asked to add a curve where the game on release was €45, by Christmas it was already in the 20s, and by March it was under €10. We stopped bleeding money on them and sold a lot more at the same time.

In the late '80s, a store owner could buy an NES game for around $25 wholesale from a distributor and sell it for, in some cases, $50. Accounting for inflation, today that would mean a profit of just under $50 per sale.
Well, I don't think it's that different now. I recall in some PS3 models in 2014 (when I was involved in a store that tried to have new stock), the margin for a distributor that dealt with us (the bigger ones don't care about small fish) was barely €20, and at that margin, it was not worth it. I'd rather have the owner go to a chain store, purchase the console there to resell it, and if it had any problem, we'd have less problems dealing with them than the distributors.
posted by lmfsilva at 7:32 AM on July 18, 2017 [2 favorites]

lmfsilva, I believe that the quote is referring to games, not consoles. There has never been much of a markup on consoles. When the first Playstation came out I believe our margin was $1. Retailers make money off selling that second controller, a memory card, and that Spice Girls "game" that daughters wanted so badly that Dad was willing to drop $150 on a machine that could play it. (Seriously, those ladies sold more Playstations than everyone working at Sony Computer Entertainment ever did.) Console makers make money back from charging Electronic Arts or Square $5/disc for the license to their DRM or keeping all the money in the case of a game by Sony or Nintendo.

I don't know what the exact numbers were I'm pretty sure that our company was paying around $38/copy for high profile titles like the Maddens and WWE games that were selling for $49.99 during the first pressings and the wholesale would drop to around $15 for the titles that we sold for $19.99. The problem that stores are running into now is that the demand drops so quickly from some titles that by the time they've sold through half of their $55 supply on a game, the game is already retailing for $50. Heck, I can't remember the last time a game in the Lego series didn't drop below half ($30) within twelve months. The problem is that large retailers can make deals to insure themselves against this (via guaranteed sales contracts) while the little guys have to absorb the risk to stay in the game.
posted by dances with hamsters at 12:27 PM on July 20, 2017 [2 favorites]

At one place, we had no games distributor, on the other, it usually had only a few back-catalog releases with some margin and a few new ones with little. They also had used stock and the margins were far better.

Like the article said, buying from Amazon was less risky and often cheaper. I recall giving some tips to a costumer who could import from GAME Spain on games I reckon could push to more discerning customers (that's how I got a brand new OdinSphere, for instance - he paid something like €25 for 5, I gladly gave him something like €50 in credit and sold them all quickly at €19 each. I got a game I wouldn't find here for €10, he got a new release for €25, store made a decent profit on the transactions overall and those discerning customers were all oh shit you have this?! and everyone was happy).

Biggest problem with having one distributor that was the official in all but name for everyone but Nintendo (who had their own bizarro circus) was that according to the owner, they tried to blackball him out of business in the Early 2000s because he was one of the first to bring the concept of "used game store" here (during the 80s we preferred to cut the middleman and go straight to ZX Spectrum piracy, and consoles weren't a thing until the early 90s, when he came here), and simply hated his guts for cutting into their profits.
posted by lmfsilva at 1:36 PM on July 20, 2017

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