So, this was the only possible slot I could think of to post this. I'm currently enrolled in school for business admin in hopes of opening up a gaming shop. I've noticed the areas I've lived in shops literally drop like flies. I'm actually quite fond of the business world and combined with my love for gaming in general I want to give it a shot. I have a very creative mind as far as marketing is concerned and would like any input as to how to go about pulling it off. How much in loans would I need starting from scratch? What ideas have been successful and what not? Which vendors should I buy from aside from SCG (for buying bulk rares)? A few ideas of my own and no shop has done this to my knowledge, allowing people to do FNM tourneys of their choice for free the week of their birthday assuming that they can actually prove it, maybe add a report card bonus type deal for the kiddies, and I'm thinking about grabbing some friends of mine to help run a little grill section inside the shop as well. I want to do casual constructed, modern, EDH, THG, 1.5, and possibly T1 tourneys all $5 entrance, draft and such the typical prices. I will probably promote $1 repacks as well, buy a certain amount and get a few free or spend a certain amount and get a few free repacks, which I did get a lion's eye diamond out of a repack prior to it jumping to $60. So any help from store owners would be great, oh and the town I'm wanting to open it at is a college town too if that helps.
Well, honestly that could be said about anything. I mean why open up a computer shop when you got best buy, office depot, etc etc... why open up a pet store when you got pet smart. If I had that sort of mentality I wouldn't even bother going into business admin. I'm not questioning your experience I just need validation. My g/f is wanting to open up a school too which she recently got certified in teaching Montessori and her old boss is close to retirement so that's another monster I'd have to contend with as well. I think the biggest issue is location if I could manage opening a shop anywhere near a wally world or gamestop I'd have a pretty high chance of success, especially in a decent size college town.
and believe me being in a high volume area offsets the x5 cost for putting it in the middle of nowhere.
Here are some tips from what I've seen be successful and unsuccessful in stores in my area:
1) Give people a reason to want to be in the store. Things like EDH league nights, even if the players aren't paying you anything to be there, get them into the store and this means they'll be more likely to buy singles, packs, snacks, sleeves, deckboxes, etc. My favorite store in the area has board game leagues, EDH leagues, a couple videogame systems set up, even a few computers so people can hang around and play League of Legends/games on Steam. An empty store is a dead store.
2) Have a well-stocked singles supply. This doesn't mean just Standard, but Legacy staples are always great to have around. Even if you're charging SCG prices for them, someone will eventually want to buy them on short notice, and if you don't have them for sale, someone else will. Never say no to someone offering to sell you older stuff or even "bulk" collections (though of course offer a price on it that's profitable to you). Every person I know involved with a game store has stories about finding high-value uncommons or even stuff like fetches and Confidants in "bulk" collections that they bought for a few dollars per thousand cards.
Even more than that, it's important to have a good backlog of old commons and uncommons. I regularly go to my game store to pick up $.50-$1 uncommons because it's not worth bothering online for something like that. If they regularly have what I'm looking for, I'm much more likely to come back looking for more.
3) Location. This cannot be stressed enough. Find somewhere without a nearby game store. Find somewhere that's easily accessible via public transportation. Find somewhere near colleges. The easier it is for people to get to you, the more likely they will.
4) Offer prizes in store credit over packs if players want. Offer a higher trade-in amount if they trade in for store credit. Store credit is amazing, because it makes people come back, and often they'll spend it on a portion of a purchase, and spend cash on the rest. And as an eternal player, I'd much rather have Store credit than packs, because packs don't give me much, but I can always buy part of a fetch or something with credit.
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Fine, I'm more awake now. This is why I say the 1st advice from 95% of store owners is don't get in. Do you have answers to the following questions?
1. What's your competition?
2. What's your areas demographics?
3. What's your profit margins?
4. What's your player base?
5. Can you get your player base away from the store that has it?
6. If there isn't another store why not?
7. Are you able to put in the time to run this store (minimum 70 hrs a week)
This isn't anywhere near the complete number of questions needed to be asked. Furthermore you say you're coming in from scratch hoping to get a bank loan for a magic store. I certainly hope you have money to borrow, personally it took me over a yr to get a loan, with online sales the entire time, a 20+ page business plan, and me having equity in the business over the amount I was asking for. Banks don't trust the gaming retail industry for good reason. Are you really getting a degree in business admin just for this? If so there are many better degrees, including finance, business entrepreneurship, accounting etc. These are all better fits that are still relevant in the "real world" if you decide not to go through this. Because for the 1st 2-3 years you shouldn't be planning on administrating **** for employees, but rather you should be watching every ****ing penny, knowing every ****ing margin, and making sure you can pay rent. I can tell that the serious thought hasn't made it into the dream yet, because you're hoping to open next to a "wally world", rent is always higher next tot hose assuming of course you're talking about a strip mall a block away, because wal-marts don't have strip malls connected to them. Try making up a quick avg. profits/expenses for a month and ask yourself if you think you can make sales for what you need. Don't lowball any of your expenses, be very conservative. Include rent, utilities, paying yourself, CoGS based on a profit margin of oh 40-45% since you're new, bank loan, petty cash of idk 100-200 a month generally cleaning supplies, and throw in an extra couple hundred for misc. expenses.
I'm going to stop here, since I think this covers the basics on why opening a store is v difficult, and asking for advice on here is a good sign you're not ready or even close. Any other store owners want to chime in or did I cover the basics well enough?
Fine, I'm more awake now. This is why I say the 1st advice from 95% of store owners is don't get in. Do you have answers to the following questions?
1. What's your competition?
2. What's your areas demographics?
3. What's your profit margins?
4. What's your player base?
5. Can you get your player base away from the store that has it?
6. If there isn't another store why not?
7. Are you able to put in the time to run this store (minimum 70 hrs a week)
This isn't anywhere near the complete number of questions needed to be asked. Furthermore you say you're coming in from scratch hoping to get a bank loan for a magic store. I certainly hope you have money to borrow, personally it took me over a yr to get a loan, with online sales the entire time, a 20+ page business plan, and me having equity in the business over the amount I was asking for. Banks don't trust the gaming retail industry for good reason. Are you really getting a degree in business admin just for this? If so there are many better degrees, including finance, business entrepreneurship, accounting etc. These are all better fits that are still relevant in the "real world" if you decide not to go through this. Because for the 1st 2-3 years you shouldn't be planning on administrating **** for employees, but rather you should be watching every ****ing penny, knowing every ****ing margin, and making sure you can pay rent. I can tell that the serious thought hasn't made it into the dream yet, because you're hoping to open next to a "wally world", rent is always higher next tot hose assuming of course you're talking about a strip mall a block away, because wal-marts don't have strip malls connected to them. Try making up a quick avg. profits/expenses for a month and ask yourself if you think you can make sales for what you need. Don't lowball any of your expenses, be very conservative. Include rent, utilities, paying yourself, CoGS based on a profit margin of oh 40-45% since you're new, bank loan, petty cash of idk 100-200 a month generally cleaning supplies, and throw in an extra couple hundred for misc. expenses.
I'm going to stop here, since I think this covers the basics on why opening a store is v difficult, and asking for advice on here is a good sign you're not ready or even close. Any other store owners want to chime in or did I cover the basics well enough?
Never said I was ready for it, not now at least. I never said that it would be easy either, the current location I'm looking at recently opened a shop but from the way it sounds is again a horrible location. I didn't mean right next door to wally world, but more along the lines of a mile or so away near a higher volume traffic area. I'm not getting into business admin just to open a game shop either, this has just been a thought and figured I'd ask on here about the idea.
TBH, the shops I've been to haven't had much of a schedule. It was pretty much FNM and some stuff during the weekends but not enough during weekdays. Again poor location choices and bad business moves killed them, lack of variety, not horrible atmospheres but not good either, pretty dull and they couldn't get new customers most likely from poor advertising.
I too was thinking of opening a game store in a very busy and profitable area - rent was incredibly high and the general rule of thumb is you need to make about 4x-5x your rent to stay alive, forget about making enough money to feed your family. As captainobvious88 recommends, I had talked to over a dozen game store owner/operators over the course of two years and heard enough horror stories of stress and money woes to really scale back my desire to open a store. Yes, it's a great idea to run a business with something you like, but it's not always profitable.
I eventually decided on a part time model - I have a mobile event business that caters to private and public schools. I bring my supplies to schools and libraries, running sealed, draft, and standard events. This model works well (overhead is really low) but it requires you to partner with a game store to get lower priced product to sell (this was the most difficult part of the whole idea) - WotC's systems can't handle a mobile concept and requires a store front to set up an account.
I now run events at several schools and town libraries, I have no employees to pay, and no rent. I live in a very rural area so this works out great; a brick and mortar would die in 6 months.
Throwi: thanks so much for posting. I'm going through the exact same process in virtually the exact same rural situation. I'm well-connected to the local college community, and know many gamers in the area who say they'll buy from me if I open a store. Yet, it is still very rural and even going into a 500 sq. ft. space at $375/mth is scary when I profit forecast based on the available consumer base. I'm wondering how you get schools to allow you to sell products for profit on school grounds?
If I can't sell on school grounds, there are a few event centers I can access for moderate fees to host events locally. I was in a conundrum as to what to do with my retail space while I was hosting at the event centers and selling at conventions, but your concept seems adaptable to my situation.
Oddly for this forum, I'm not all that much into Magic. To me, its just one of thousands of great games that I love. Since it is so hard to access Magic at competitive prices w/o a retail storefront, I'm thinking I should just do an event business focused on everything but Magic. I'll buy/sell it at opportunity, but it seems to be a crowded and bargain-valued marketplace for the base product (boosters) that rests on a bubble of singles pricing that's ripe to burst any day now. I see Magic-only stores and have to question the sanity of anyone hinging their entire retail store-model on a single product, let alone a speculative one. We all need to take a lesson from 17th century Dutch tulip collectors (that was the first speculative market in a modern sense). I recommend you diversify similarly.
Also, there are several good game stores and one great one located in a nearby urban area, so waiting let's me build funds and experience while one or more of them go out of business, hopefully leaving a vacuum for me at the right time to get into the right location. I know that sounds kind of morbid, but the market is just to full over there for another full retail store to make it. So I have to bide my time and plan.
I'm sure there are many out there in the same situation as us: lots of players and no store to play in. Here's what I've learned in the last few months...
The mobile business, at least for MTG, works moderately well. I've increased my event numbers by 25% each month over the last 3 months... I have many new and younger players, regularly have between 16-20 players at every event. Now that doens't seem too high, but when I'm giving a small donation to the local library (who quite frankly, just want to see kids in the library and never asks for anything from me), my costs are minimal. I tend to take in about $200-$250 gross per event (over the entrance fee, mostly a wash with 1 pack and the donation to library). I run 2 library events per month (in separate towns).
During the school year, I run events at two local private schools about once every new release. There are three more private schools in the immediate area and I'm hoping to begin working with at least one of them in the Fall. These "new release" events generally have around 16-24 players, and are run as sealed or draft formats. I usually gross about $500+ at those events. I do not run events at the public schools in the area for the main reason you've mentioned (selling at the school), but most of those kids show up at my library events anyway. Private school students have less capability to travel outside their campuses, and Student Activities Directors are more apt to bring events in to the school. They know I won't unless the kids support my business by buying additional product.
You can see this isn't big enough to be a fulltime business yet. Running more events doesn't necessarily mean more money or players... there is a point of diminishing returns somewhere - I haven't figured that out just yet.
As for running non-MTG events (board games, RPGs, etc.), I haven't really explored that yet. I'm solely focused on MTG at the moment - kids are recruiting their friends and as long as the numbers increase, I'm not too worried about the single dependency/product issue.
The hardest part of a mobile MTG business is getting product at a cost that makes it worth it. When I contacted distributors and WotC, they both said that they couldn't help me because I did not have a brick and mortar store (interestingly, I got pushed up the food chain at WotC, eventually talking to one of their senior folks, who agreed that the mobile business model was interesting and likely viable, but still couldn't help because of their systems/logistics). They recommended I work with a LGS to act as a middle-man.
After contacting half a dozen stores, all over an hour or more from my location (too close and I was "stealing" business), I finally found one store that wanted to help. My purchases of product actually helped them to reach a new discount tier, so we are helping each other (although I feel I'm getting the better end of the deal). They sell me boosters at their cost, and I pay a small fee over their cost on Fat Packs, sleeves, dice, etc. If it wasn't for their support, I'd never have even tried this idea. Obviously, getting product at/near cost is ***critical*** to making this idea work!
My long-term goal is still to open a store and expanding to other genres. I've talked with several owners, some of which have since closed their doors due to the economy and internet. Getting players in the store is easy - getting them to buy from you is hard. If the local storefront owners in my area ever figure out that it's better to get some income instead nothing for the several empty spaces they have, I may take a stab at it. My thought is about gross sales at 4x rent should keep me business. Unfortunately, the smallest spaces charge over $700 for rent... not doable. They can keep their spaces empty then.
Many folks have discussed the singles part of the business. I've found that singles don't do well with my business model. Do I have them and sell/trade them at each and every event? Yes. The bulk of my sales are with boosters, sleeves, and deck boxes though. Single sales represent about 5% of my gross each event. I do not open up tons of boosters for the singles, either for events or internet sales. It's just not worth my time. Remember, this is what I've found where I'm at. Might be different for others.
If you have any questions, feel free to shoot them my way.
Thanks again Throwi, though I've scrounged and found $350-400 rents are possible for a minimal space in my economically depressed rural area, I'm still not comfortable with shelling out rent from the start knowing how few people actually live here. I'll examine the library and private school routes, but first I need a source. That's a great deal you found. I'll get into singles as I learn the MTG corner of the market via events.
I'd recommend going to the nearest college and seeing about getting the student chess or game club to start an annual convention that you can vend at. The students get lots of space for free from their school, so they can run a diverse game event and give you wider access and reputation in the regional game community.
The other thing to look at is military bases. Armed Services people are a semi-captive audience who at times have a lot of time to kill far from family and friends.
I don't have any questions for now, but I'm sure something will come up:-)
-Yetibruce
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and believe me being in a high volume area offsets the x5 cost for putting it in the middle of nowhere.
1) Give people a reason to want to be in the store. Things like EDH league nights, even if the players aren't paying you anything to be there, get them into the store and this means they'll be more likely to buy singles, packs, snacks, sleeves, deckboxes, etc. My favorite store in the area has board game leagues, EDH leagues, a couple videogame systems set up, even a few computers so people can hang around and play League of Legends/games on Steam. An empty store is a dead store.
2) Have a well-stocked singles supply. This doesn't mean just Standard, but Legacy staples are always great to have around. Even if you're charging SCG prices for them, someone will eventually want to buy them on short notice, and if you don't have them for sale, someone else will. Never say no to someone offering to sell you older stuff or even "bulk" collections (though of course offer a price on it that's profitable to you). Every person I know involved with a game store has stories about finding high-value uncommons or even stuff like fetches and Confidants in "bulk" collections that they bought for a few dollars per thousand cards.
Even more than that, it's important to have a good backlog of old commons and uncommons. I regularly go to my game store to pick up $.50-$1 uncommons because it's not worth bothering online for something like that. If they regularly have what I'm looking for, I'm much more likely to come back looking for more.
3) Location. This cannot be stressed enough. Find somewhere without a nearby game store. Find somewhere that's easily accessible via public transportation. Find somewhere near colleges. The easier it is for people to get to you, the more likely they will.
4) Offer prizes in store credit over packs if players want. Offer a higher trade-in amount if they trade in for store credit. Store credit is amazing, because it makes people come back, and often they'll spend it on a portion of a purchase, and spend cash on the rest. And as an eternal player, I'd much rather have Store credit than packs, because packs don't give me much, but I can always buy part of a fetch or something with credit.
Currently Playing:
Legacy: Something U/W Controlish
EDH Cube
Hypercube! A New EDH Deck Every Week(ish)!
1. What's your competition?
2. What's your areas demographics?
3. What's your profit margins?
4. What's your player base?
5. Can you get your player base away from the store that has it?
6. If there isn't another store why not?
7. Are you able to put in the time to run this store (minimum 70 hrs a week)
This isn't anywhere near the complete number of questions needed to be asked. Furthermore you say you're coming in from scratch hoping to get a bank loan for a magic store. I certainly hope you have money to borrow, personally it took me over a yr to get a loan, with online sales the entire time, a 20+ page business plan, and me having equity in the business over the amount I was asking for. Banks don't trust the gaming retail industry for good reason. Are you really getting a degree in business admin just for this? If so there are many better degrees, including finance, business entrepreneurship, accounting etc. These are all better fits that are still relevant in the "real world" if you decide not to go through this. Because for the 1st 2-3 years you shouldn't be planning on administrating **** for employees, but rather you should be watching every ****ing penny, knowing every ****ing margin, and making sure you can pay rent. I can tell that the serious thought hasn't made it into the dream yet, because you're hoping to open next to a "wally world", rent is always higher next tot hose assuming of course you're talking about a strip mall a block away, because wal-marts don't have strip malls connected to them. Try making up a quick avg. profits/expenses for a month and ask yourself if you think you can make sales for what you need. Don't lowball any of your expenses, be very conservative. Include rent, utilities, paying yourself, CoGS based on a profit margin of oh 40-45% since you're new, bank loan, petty cash of idk 100-200 a month generally cleaning supplies, and throw in an extra couple hundred for misc. expenses.
I'm going to stop here, since I think this covers the basics on why opening a store is v difficult, and asking for advice on here is a good sign you're not ready or even close. Any other store owners want to chime in or did I cover the basics well enough?
Never said I was ready for it, not now at least. I never said that it would be easy either, the current location I'm looking at recently opened a shop but from the way it sounds is again a horrible location. I didn't mean right next door to wally world, but more along the lines of a mile or so away near a higher volume traffic area. I'm not getting into business admin just to open a game shop either, this has just been a thought and figured I'd ask on here about the idea.
TBH, the shops I've been to haven't had much of a schedule. It was pretty much FNM and some stuff during the weekends but not enough during weekdays. Again poor location choices and bad business moves killed them, lack of variety, not horrible atmospheres but not good either, pretty dull and they couldn't get new customers most likely from poor advertising.
I too was thinking of opening a game store in a very busy and profitable area - rent was incredibly high and the general rule of thumb is you need to make about 4x-5x your rent to stay alive, forget about making enough money to feed your family. As captainobvious88 recommends, I had talked to over a dozen game store owner/operators over the course of two years and heard enough horror stories of stress and money woes to really scale back my desire to open a store. Yes, it's a great idea to run a business with something you like, but it's not always profitable.
I eventually decided on a part time model - I have a mobile event business that caters to private and public schools. I bring my supplies to schools and libraries, running sealed, draft, and standard events. This model works well (overhead is really low) but it requires you to partner with a game store to get lower priced product to sell (this was the most difficult part of the whole idea) - WotC's systems can't handle a mobile concept and requires a store front to set up an account.
I now run events at several schools and town libraries, I have no employees to pay, and no rent. I live in a very rural area so this works out great; a brick and mortar would die in 6 months.
If I can't sell on school grounds, there are a few event centers I can access for moderate fees to host events locally. I was in a conundrum as to what to do with my retail space while I was hosting at the event centers and selling at conventions, but your concept seems adaptable to my situation.
Oddly for this forum, I'm not all that much into Magic. To me, its just one of thousands of great games that I love. Since it is so hard to access Magic at competitive prices w/o a retail storefront, I'm thinking I should just do an event business focused on everything but Magic. I'll buy/sell it at opportunity, but it seems to be a crowded and bargain-valued marketplace for the base product (boosters) that rests on a bubble of singles pricing that's ripe to burst any day now. I see Magic-only stores and have to question the sanity of anyone hinging their entire retail store-model on a single product, let alone a speculative one. We all need to take a lesson from 17th century Dutch tulip collectors (that was the first speculative market in a modern sense). I recommend you diversify similarly.
Also, there are several good game stores and one great one located in a nearby urban area, so waiting let's me build funds and experience while one or more of them go out of business, hopefully leaving a vacuum for me at the right time to get into the right location. I know that sounds kind of morbid, but the market is just to full over there for another full retail store to make it. So I have to bide my time and plan.
I'm sure there are many out there in the same situation as us: lots of players and no store to play in. Here's what I've learned in the last few months...
The mobile business, at least for MTG, works moderately well. I've increased my event numbers by 25% each month over the last 3 months... I have many new and younger players, regularly have between 16-20 players at every event. Now that doens't seem too high, but when I'm giving a small donation to the local library (who quite frankly, just want to see kids in the library and never asks for anything from me), my costs are minimal. I tend to take in about $200-$250 gross per event (over the entrance fee, mostly a wash with 1 pack and the donation to library). I run 2 library events per month (in separate towns).
During the school year, I run events at two local private schools about once every new release. There are three more private schools in the immediate area and I'm hoping to begin working with at least one of them in the Fall. These "new release" events generally have around 16-24 players, and are run as sealed or draft formats. I usually gross about $500+ at those events. I do not run events at the public schools in the area for the main reason you've mentioned (selling at the school), but most of those kids show up at my library events anyway. Private school students have less capability to travel outside their campuses, and Student Activities Directors are more apt to bring events in to the school. They know I won't unless the kids support my business by buying additional product.
You can see this isn't big enough to be a fulltime business yet. Running more events doesn't necessarily mean more money or players... there is a point of diminishing returns somewhere - I haven't figured that out just yet.
As for running non-MTG events (board games, RPGs, etc.), I haven't really explored that yet. I'm solely focused on MTG at the moment - kids are recruiting their friends and as long as the numbers increase, I'm not too worried about the single dependency/product issue.
I'll post risks/issues in another post shortly.
~throwi
The hardest part of a mobile MTG business is getting product at a cost that makes it worth it. When I contacted distributors and WotC, they both said that they couldn't help me because I did not have a brick and mortar store (interestingly, I got pushed up the food chain at WotC, eventually talking to one of their senior folks, who agreed that the mobile business model was interesting and likely viable, but still couldn't help because of their systems/logistics). They recommended I work with a LGS to act as a middle-man.
After contacting half a dozen stores, all over an hour or more from my location (too close and I was "stealing" business), I finally found one store that wanted to help. My purchases of product actually helped them to reach a new discount tier, so we are helping each other (although I feel I'm getting the better end of the deal). They sell me boosters at their cost, and I pay a small fee over their cost on Fat Packs, sleeves, dice, etc. If it wasn't for their support, I'd never have even tried this idea. Obviously, getting product at/near cost is ***critical*** to making this idea work!
My long-term goal is still to open a store and expanding to other genres. I've talked with several owners, some of which have since closed their doors due to the economy and internet. Getting players in the store is easy - getting them to buy from you is hard. If the local storefront owners in my area ever figure out that it's better to get some income instead nothing for the several empty spaces they have, I may take a stab at it. My thought is about gross sales at 4x rent should keep me business. Unfortunately, the smallest spaces charge over $700 for rent... not doable. They can keep their spaces empty then.
Many folks have discussed the singles part of the business. I've found that singles don't do well with my business model. Do I have them and sell/trade them at each and every event? Yes. The bulk of my sales are with boosters, sleeves, and deck boxes though. Single sales represent about 5% of my gross each event. I do not open up tons of boosters for the singles, either for events or internet sales. It's just not worth my time. Remember, this is what I've found where I'm at. Might be different for others.
If you have any questions, feel free to shoot them my way.
~throwi
I'd recommend going to the nearest college and seeing about getting the student chess or game club to start an annual convention that you can vend at. The students get lots of space for free from their school, so they can run a diverse game event and give you wider access and reputation in the regional game community.
The other thing to look at is military bases. Armed Services people are a semi-captive audience who at times have a lot of time to kill far from family and friends.
I don't have any questions for now, but I'm sure something will come up:-)
-Yetibruce