WHAT DOES IT COST TO DO A GAME?
Steve Cole reports: A lot, and more than you think. A
lot of costs go into a game, before, when, and after it gets
printed.
The first thing most players don't know is the retail structure. A publisher sells a $20 game for $8 (and has to pay the cost of shipping out of what he gets) to a wholesaler who sells it to a retailer for $11. The retailer tries to sell it for $20, but many new games the retailer gave a try end up in the half-price bin just to get (most of) the money out of them. So remember when you see a $20 game that the publisher only got about $7.50 for it. (That "cost of shipping" also included a buck or two for the cardboard carton that the products were packed in as well as tape and bubble wrap. That all adds up.)
The most obvious cost is printing. That $20 game probably cost about $4 to print, but the actual amount might have been anywhere from $2 to $5 just depending. (Sometimes one product in a series is more or less expensive than the others but has to sell for the same amount). Many publishers work on the theory to take the print cost and multiply by five, or six, or ten, to establish the retail price. Other publishers set the retail price by finding similar products from other companies. (ADB prices are actually some of the lowest in the industry based on what you actually get. Ever notice that other companies have wider margins, bigger type, and more white space? That may be visually more pleasing but it also means that they did less design work than we did and gave you less value.)
That, obviously, is not the only cost. The publisher has to pay for art, both cover art and interior art. The more art, the more cost. The more copies, the lower the cost of the art in each one. I have seen game companies pay $100 for cover art and I have seen them pay $5000 for cover art. I have seen incredibly good art and incredibly bad art at all of the price levels. What you pay is not what you get. Who you hire is what you get. We probably have less art in our products that most companies, partly because we had to lose space we might actually use for another rule, partly because we don't like spending a lot of money, and partly because we're usually in a time crunch and don't how how much art there is room for until very late in the process when there is very little time to use it. You can stretch the art budget re-using old art (copying RPG art we already paid for into boardgames is a great way to save money) and by using simple graphics that are done in house. You can also have artists do art in layers so you can pull a guy out of this cover or a starship out of that cover and use it as interior art in another product.
Another cost is royalties or other fees to an author who wrote the book. Writing a book in house means not having to pay for an outside author, but also means paying the payroll for that inside author. If we have to pay the inside guy to edit and fix the outside author's work, then we're paying more than if we just wrote it ourselves, but what you're buying is a new idea that nobody inside the office had.
There may be intellectual property royalties, perhaps to someone who owns a game system, or perhaps to a motion picture company or book publisher that owns the background, or maybe both. In theory, you're paying more on every copy in order to hopefully sell more copies.
Another cost is page layout, editing, and proofreading. We do all of that in-house so it's just payroll costs, but it also means we cannot schedule a product unless we can justify the payroll cost of someone to lay out the pages, proofread it, and edit it. Some companies contract out those services, and they also have to justify the costs.
We can and do use standard components as much as we can. We buy dice in lots of 10,000 for example, and we buy a lot of plain white boxes that we use sleeve wrappers for. We also buy a lot of plastic clamshells that we use printed covers for. This keeps down the cost of those parts. For some unusual things (the little red beads we use for SFBF damage markers, the little balls of fluff we use for tribbles) we will if we can find someone who already makes that (for some real world reason) in quantities of a million and see if we can buy them in little bags.
The first thing most players don't know is the retail structure. A publisher sells a $20 game for $8 (and has to pay the cost of shipping out of what he gets) to a wholesaler who sells it to a retailer for $11. The retailer tries to sell it for $20, but many new games the retailer gave a try end up in the half-price bin just to get (most of) the money out of them. So remember when you see a $20 game that the publisher only got about $7.50 for it. (That "cost of shipping" also included a buck or two for the cardboard carton that the products were packed in as well as tape and bubble wrap. That all adds up.)
The most obvious cost is printing. That $20 game probably cost about $4 to print, but the actual amount might have been anywhere from $2 to $5 just depending. (Sometimes one product in a series is more or less expensive than the others but has to sell for the same amount). Many publishers work on the theory to take the print cost and multiply by five, or six, or ten, to establish the retail price. Other publishers set the retail price by finding similar products from other companies. (ADB prices are actually some of the lowest in the industry based on what you actually get. Ever notice that other companies have wider margins, bigger type, and more white space? That may be visually more pleasing but it also means that they did less design work than we did and gave you less value.)
That, obviously, is not the only cost. The publisher has to pay for art, both cover art and interior art. The more art, the more cost. The more copies, the lower the cost of the art in each one. I have seen game companies pay $100 for cover art and I have seen them pay $5000 for cover art. I have seen incredibly good art and incredibly bad art at all of the price levels. What you pay is not what you get. Who you hire is what you get. We probably have less art in our products that most companies, partly because we had to lose space we might actually use for another rule, partly because we don't like spending a lot of money, and partly because we're usually in a time crunch and don't how how much art there is room for until very late in the process when there is very little time to use it. You can stretch the art budget re-using old art (copying RPG art we already paid for into boardgames is a great way to save money) and by using simple graphics that are done in house. You can also have artists do art in layers so you can pull a guy out of this cover or a starship out of that cover and use it as interior art in another product.
Another cost is royalties or other fees to an author who wrote the book. Writing a book in house means not having to pay for an outside author, but also means paying the payroll for that inside author. If we have to pay the inside guy to edit and fix the outside author's work, then we're paying more than if we just wrote it ourselves, but what you're buying is a new idea that nobody inside the office had.
There may be intellectual property royalties, perhaps to someone who owns a game system, or perhaps to a motion picture company or book publisher that owns the background, or maybe both. In theory, you're paying more on every copy in order to hopefully sell more copies.
Another cost is page layout, editing, and proofreading. We do all of that in-house so it's just payroll costs, but it also means we cannot schedule a product unless we can justify the payroll cost of someone to lay out the pages, proofread it, and edit it. Some companies contract out those services, and they also have to justify the costs.
We can and do use standard components as much as we can. We buy dice in lots of 10,000 for example, and we buy a lot of plain white boxes that we use sleeve wrappers for. We also buy a lot of plastic clamshells that we use printed covers for. This keeps down the cost of those parts. For some unusual things (the little red beads we use for SFBF damage markers, the little balls of fluff we use for tribbles) we will if we can find someone who already makes that (for some real world reason) in quantities of a million and see if we can buy them in little bags.
One element of the cost few think about is how much money has to be spent before the first copy of the product ships. We print color work (die cut counters, FC ship cards, and covers) outside in quantities of a thousand or more. That means tying up thousands of dollars. For some companies, that means borrowing that money (or owing a printer who thought he would get paid promptly), but ADB never prints anything without having the cash in the bank first. It's just a rule we have, one Dave Ramsey copied from us.
When you actually get the game components back from the various vendors and printers, somebody has to assemble them into boxes or wrappers. That is more payroll cost. While we're talking about payroll costs, let's talk about the building that the employee works in and the utilities (water, air condition, heating, electricity) he needs in order to function. All of that is overhead, and every product has to make more than we spent on printing to pay for some of the overhead. Also remember that our game designers may well spend half of their time doing things other than game design (government forms, customer service, strategic planning, marketing, supervising things like SFBOL) none of which pays for the overhead, so each game product has to pay for the overhead spent not just working on that product, but working on no end of things other than products.
Individual mail orders cost a lot more to handle that bulk wholesaler orders (almost the same amount of employee time and packing materials), but since you make more on them, that's ok. What we charge for shipping only covers what we pay the post office (or about 75% of what we pay UPS) and doesn't cover any part of the cost of processing the invoice, pulling and checking the order, or packing it. Nor does it cover the credit card fees which are two or three times as high for a small mail order dealer as they are for a huge retail store.
And finally let's remember that some part of that overhead I mentioned earlier included the cost of the game designer answering questions months later or the marketing lady trying to drum up some business when the product is actually shipping.
posted by Federation Commander at 4:00 AM
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