As promised in another thread, here's a cautionary tale of woe regarding the games publishing business.
A few years ago, myself and Paul (Bourne) were happily working away on a website for a free game setting. It was called a|state. Paul did the art, I did the words, some people liked it, happiness ensues. Now, one evening, after a particularly glowing round of online praise and bloated with ambition, we thought "I wonder if we could publish this?"
Cue months and months of hard slog, dragging poor old John Wilson into the fray (his patience truly does know no limit), and we get close to what might be termed a complete game. We allow ourselves a brief moment of rejoicing. As an aside, it was during this lengthy process of writing, artworking and finding out how the hell we went about actually creating a published game, that (while at Conpulsion in Edinburgh) Paul and I meet a bloke in a trenchcoat who shakes our hands and wishes us all the best of luck with our project. He was very pleasant and enthusiastic. "Gosh" we thought after he had wandered away "What a nice bloke." His name was Gregor Hutton.
We even travelled down to London at the kind invitation of James Wallis to pick his rains over lunch and numerous coffees. His advice and wisdom was invaluable. I still adhere to many of the snippets of publishing advice that he gave that day.
Now, we were young(ish) and foolish back then. The way you published a game (according to accepted wisdom) was to produce a big hardback (or softback) and sell it through three tier distribution. Ok, here's a bit about what that is:
If you are a small publisher, the big distributors (especially in the US, Esdevium over here are somewhat more accomodating) will not touch you with a ten foot pole. You have to go through a fulfillment house. What the fulfillment house does is collate the product of numerous small publishers and sell it on to the distributors. Then, the distributors sell stuff to individual games shops, who sell it to you, the eager customer. This is three tier system in a nutshell. Sounds good, yes? No. See, a distributor will pay about 40% of cover price for your book, perhaps a tadge less if they buy in big quantities. Now, because the fulfillment house do you a service by marketing your stuff to distributors, they take a cut of what you get. Generally, the fulfillment people will take 15 - 20% of that 40%. And they want you to pay for shipping to the distributors. When all that is done, you're probably likely to get about 30% of your cover price back. Out of this, you've got to pay for printing, artworking, materials, shipping (to the fulfillment house) and all the other stuff required to actually make a book. Isn't this sounding less appealing all the time?
Right, back on track.
We decided to print just over 1000 copies of a|state through a huge Canadian printing company called Transcontinental. Now, to be fair, Transcon were great and have no horrific part in this tale of gloom. We had contracted with a fulfillment house called Osseum Entertainment, who were highly recommended and on the ball. And things went well. Distributors bought a|state. Lots of it. So much so, that Osseum advised we do another print run. We did so. Hell, we had a supplement printed as well. But remember, we're only getting 30% (roughly) of the cover price here. Our margins were more slender than Kate Moss with bulimia. At this point we should have realised that there might be other ways of conducting business. We didn't.
Can you tell things are going to start going wrong soon?
a|state was nominated for the ENnies in 2004 and, in a fit of excitement, I flew to Gen Con. OK, so we didn't win, but it was great. And the Osseum guys put me up in lavish style. They were fun, sensible and seemed to have really solid business heads on their shoulders. I came back full of glowing praise for them. All was well.
The the monthly payments stopped arriving.
Then we didn't get regular spreadsheets and stock updates.
The all communication dies.
The short version of things is that the downturn in the D20 market hit Osseum badly. Real badly. The guy in charge freaked and became something of a paranoid shut-in. Communication was zero, they owed us several thousand dollars in back payments and they had most of our stock in some warehouse somewhere in Back of Beyond, USA. Brown trouser moment? You are not kidding.
Months went by, nothing. Then other publishers whom went through Osseum start talking about things online. Turns out everyone is getting stiffed, nobody can get in touch with the company and nobody is getting any money. The guy who runs the company turns out to be suicidal (this is not anecdotal, I actually spoke to him, albeit briefly) and off his head.
The upshot of all this? No money. Luckily, we got in touch with the warehouse and secured all of our extant stock. Luckily, we got in touch with other means of distribution. Luckily, we adopted a new and much better strategy that meant we weren't going through three tier. Indie Press Revolution were fantastic from day one. Key 20 helped us out in the beginning. Things, after a black period, looked up. Cold City was a bit of a success and help pull us out of the hole we were in.
Looking back, we can give a wry smile about it now, but going through the three tier system just isn't viable for guys like us. Hell, even without the Osseum Debacle, we were only just scraping by. How are things now? Much, much better. The way we do business now is great: I can't praise IPR enough. I can't praise the mutualistic efforts of the small press community (particular the Collective Endeavour and the IPR/Forge booth) enough.
So that's my horror story. How the three tier system and someone taking a mental turn just about killed all our dreams of publishing games. If nothing else, it was a learning experience. I certainly took a lot from it. And it's why I will never, ever recommend anyone following the same path if they are publishing a game. What is happening now in the small press scene is great: we share advice, we help each other out, there is mutualism of the best kind.
If you have any questions or comments, please do fire away.