msprange said:
Paladin said:
a gaming company seeking to make a profit on a massive scale,
No. Just. . . no. . .
It should also be said that there are probably very, very, very few gaming companies making a "profit on a massive scale".
GW is a publically listed company, so its financials results are publically available.
Looking at the income statement for FY2008 (ending June 08 ), GW had:
- Total Sales: £110 million
Cost of Sales: £33 million
Gross Profit: £77 million
Sounds impressive doesn't it?
However, the Cost of Sales figure only includes cost directly associated with the manufacture of product (i.e. materials, labour etc). It does not include all the indirect costs (operating expenses) associated with the running of the company, or other income such as royalties.
- Operating Expenses: £76 million
Other Income: £2 million
The operating expenses are exceedingly high, but I'm sure most of this cost is going to the cost associated with running their massive retail operation.
This gives us the operating profit, which is:
- Operating Profit: ~£3 million
(Note: I've rounded the figures here to keep them in whole millions - GWs reported OP was actually £2.552 million)
(Source:
http://investor.games-workshop.com/...08/full_year/consolidatedincomestatement.aspx)
If you factor in everything GW actually made a loss in 2008, and given the current financial climate I wouldn't be at all surprised to see a profits warning coming out of GW early next year.
The point is that it's very easy to look at the more commercial gaming operations (e.g. WOTC, GW, Mongoose etc) and compare them to the "mom & pop" operations and claim they are just raking in the profits, but truth be told what is generally the case is they have much, much higher operating expenses than the "mom & pop" operations, and so have to charge that much more even if they have a lower overall cost of sales due to economies of scale and purchasing power etc.
I really don't see much gross profiteering going on in the gaming market.
Regards,
Dave