Thursday, January 30, 2014
Metal Melt Down
Reports are coming in the GW is shipping left over metal models to be melted down instead of trying to sell them at even a minor discount. Now tin is running about 10 dollars a pound and a 4 cm cube is about a pound so the metal represents about 1/4th the retail value for many of the models. So if they marked them even 50% off the would still be able to get twice the amount of money for them than scrapping them. Ofcourse there are costs of sales which will eat into that return but at least the product goes to your customers who will use it to play your games with other people who could your customers also. Thus improving the network affect of the gaming which is why you were on top in the first place.
GW has been known to do things like this in the past where rumor has it that piles of Dreadfleet boxes went into essentially the wood chipper but that was a limited release item that you do want people to buy right away. Many of these models might have been sitting around for 5 or more years based on sculpts that might be 25 years old. People are not generally going to wait like 5 years to save 25% especially with prices going up 5% each year.
Now I will assume that they are going to be doing this locally as opposed to shipping the stuff all back to the UK and doing it from there as that would be a real announce since their poor distribution of specialist models around the globe back in June allowed for down under to still be fully stocked while the US and UK were sold out of many things (at full price).
GW point of view is probably that if we offer these items at a discount then our customers will buy them instead of high margin plastic and in this case we get money from a non customer source. This view is stuck back when GW was really the only game in town. More than likely these are dollars that would not have been largely parasitic as many of those old metals are very different from the current stuff and for a different group of people.
Again as before really not thinking about the customers.