How does one go about retailing a game for $15.00?!
Let's for the minute assume that it is $15.00 CAD (Canadian dollars). And that is the MSRP for the game.
Retail discount (50%) = $7.50 CAD.
Distributor discount (70%) = $4.50 CAD.
Now it costs to manufacture and ship this from overseas... From $4.50 I ask this: "How does the publisher make any money?"
It's $4.50 CAD already! If MSRP was 5x cost to manufacture, then that means the game should be made for $3.00 CAD.
How can the publisher survive on $1.50 CAD of actual earnings? What does the Game Designer earn? What about the cost to produce artwork for the game... Where does that factor into the $1.50 CAD left over?!?!
I ask this because I am crunching numbers for $6.00 CAD... The MSRP (5x) should be equal to $30.00 CAD. That's all good.
Retailers (50%) = $15.00 CAD
Distributor (70%) = $9.00 CAD
Manufacturer = $6.00 CAD
And that leaves the Publisher only $3.00 CAD?!?!
Again how does that pay for artwork or the Game Designer, etc.?!?! And leave room to pay for operations (on the publisher's side of things)...
I am doing the number crunching - but I don't see how any of it works... To me it seems like the Retailer and Distributor and consuming most of the earnings and the Publisher (and yourself - the Game Designer) get pennies on the dollar.
Maybe my math is incorrect - If so, please do not hesitate to point it out!
Cheers.
With economies of scale, it is possible to have the game made for $6.00 CAD.
But what this requires is an investment of $12,000 CAD!
Sure it's $6.00 CAD provided that 2,000 Game Sets get made.
That scares the living crap out of me. I've self-published a game before and with all the first time mistakes, making another investment of +$10,000 is well very hard to do.
I know it takes money to make money... but the margins seem so wrong, I don't even feel like thinking about taking $10,000+ CAD and letting it ride, just on a gamble that the game may sell.
Perhaps I have lost confidence due to what everyone is saying...
IDK I would pay $30.00 CAD for one (1) Game Set. Or $30.00 USD for the American side of operations. Like I said, I can't figure out how to make a game for $15.00, not even for $30.00.
The math simply isn't working out - anymore...