1. Games Workshop SWOT Analysis..
Overview
• Originally being a manufacturer of wooden boards for games such as
backgammon, mancala, Nine Mins Morris and Go; later became an importer of
the U.S. role-playing game Dungeons & Dungeons and then a publisher of
wargames and role-playing games in its own right.
• In order to promote their business they created a games club
• Target = Younger, more family oriented market
• Current headquarters are in Lenton, Nottingham.
What do they do?
Design and manufacture miniature figures and games and distribute these through uts
own network of hobby centres, independent retailers and direct through the internet and
mail order.
Information for Investors!!!
1. Games Workshop PLC, a London Stock Exchange quoted company listed in 1994,
been in business for the past 30 years. Its key brands are the high fantasy warhammer
and dark future Warhammer 40,000 games system. It has wholly owned subsidiaries
in the U.S. Canada, France, Germany, Spain, Australia, Japan and Italy.
2. They sell their products through the company’s own 380 + Hobby centres worldwide
and in more than 3600 independent outlets internationally.
3. The Hobby is also supported by a variety of international events such as the annual
Games Day convention and Golden Demon painting competition held each year in
the UK,USA, Canada, France, Spain and Germany.
4. In addition, they have other companies that design and market niche products which
appeal to hobbyists who appreciate fantasy worlds and imagery.
5. They are on a way for changing the way they interact with shareholders. They spend
few weeks each year criss-crossing the byways of the square Mile to attend meetings
in order to know more about their shareholders and to provide them with full

2. information about the company. These meetings provide them with insightful
information one being the very fact that how they should take cost out of the business
thus helping them flourish in the business in the long run.
Company’s Strategy
“To make the best fantasy miniatures and games in the world and sell them globally at a
profit”.
STRENGTHS
1. Produces the best products in the wargaming world. GW culture is continuous
improvement, cost conscious and value driven.
2. Every year they seek better ways of making their products and improving their
quality.
3. The games they provide are truly social and build a real sense of community and
comradeship
4. The more fun and enjoyable they make their games, the more customers they attract
and retain which in turn allows them to reinvest in making more and more exciting
miniatures and games which creates a virtuous circle for all.
5. They have global customers and in order to reach them they take help from
independent shops, run by owners who know their customers and offer them a good
personal service and supply them with an easy to manage range of their fastest selling
products which they resupply every month.
6. For emerging markets they work through experienced local distributors wherein they
have the Games Workshop Webstore which provides information and access to their
products with a fast and efficient delivery service.
7. They are cost conscious and avoid spending money on expensive offices, prime rent
shopping locations or advertising.
8. They invest only where it makes a positive improvement to their business model,
such as tooling to make better plastic miniatures, in opening more Hobbby centres to
improve customer service and in-fit-for-purpose systems to make their processes
more efficient and reliable.

3. 9. When an investment is made they measure its impact to ensure it delivers an
improved return on capital for their owners.
10. Their continual investment in product quality provides them with a considerable
barrier for potential competitors: it is their Fortress Wall. On the other hand, their
Hobby Centres that customise services to their clients provides another barrier to
entry: Fortress Moat. These provide competitive advantage and builds in confidence
in their ability to grow profitably in future.
11. It is a monopoly market and a niche hobby provider with 86% of global market share.
GW has a strong culture and no direct competition.
12. They recently improved their delivery services introducing the New Fast and
Trackable Express service as well as their Priority express services which delivers the
goods twice as fast as it would have been delivered using their standard shipping
services. They have priced these services at a nominal rate as seen in the figure
below:
Expected Delivery Times
Express
Cost
Express
Shipping
Standard
Shipping
UK £4 1-2 Days 2-3 Days
France 5€ 2-3 Days 5-7 Days
Germany 5€ 3-4 Days 5-7 Days
Spain 5€ 3-5 Days 5-7 Days
Italy 5€ 3-5 Days 5-7 Days
Netherlands 5€ 2-5 Days 5-7 Days
Finland 12€ 2-5 Days 5-7 Days
Denmark 90DKK 2-5 Days 5-7 Days
Sweden 120SEK 2-5 Days 5-7 Days
Norway 100NOK 2-5 Days 5-7 Days
ROW £12 7-14 Days 14-28 Days

4. 13. Customer Service is the key to Games Workshop’s existence. They moderate
specialist forum’s giving gamers the chance to ask questions and discuss what sort of
things they would like to see produced and therefore try and match the products as
per their expectations.
14. Its most effective marketing tool is the White Dwarf magazine which is published in
5 different languages around the world. They also sponsor events and tournaments.
15. GW is in a natural monopoly position whereby the global market is the only large
enough to support one business efficiently.
16. From a production point of view, it may be easier for new market entrants to enter the
market, but no one else has the established infrastructure, technological ability,
intellectual property, customer base and goodwill enjoyed by GW.
17. Being so dominant and being fundamentally cash generative and profitable GW has
the resources to ensure that the business stays technologically ahead of any potential
rivals.
18. The company manifestly owns products and service competitive advantages, the
financial strength to acquire relevant licenses such as the Lord of the Rings, Plastic
technologies and significant investment in an integrated multi-lingual web store.
19. In order to encourage and convince potential customers to become actual customers,
GW gives away a great deal of “content” for free.
WEAKNESS
1. Even though an investment in technology and investment was made sales declined
rapidly causing a corporate re-structure that included the shedding of over 10% of the
worldwide staff of 2800.
2. Poor performance over the last few years was due to management and staff of GW.
3. GW products are somewhat more expensive than similar historical wargame
products.
4. GW does have high fixed costs as a result of its vertical integration strategy – wholly
owned factories design studios and over 300 retail stores come at a high price.
5. Inaccurate decision making by experimenting with expanding its horizontal
boundaries into novels, computer games, role-play games, card games to name but a

5. few. All with the exception of novels have failed. All have been costly. Every penny
spent on them could have been spent on opening further hobby centres.
OPPORTUNITIES
1. Could be seen with smaller one man Hobby centres in market towns and suburbs of
large cities.
2. Every other country for them is still a “green field” territory wherein they could use
the same strategies they used in the UK.
3. Use of Games Workshop’s intellectual property in other markets such as computer
games.
4. To target Asian communities and diversify there due to their raising standard of living
and high disposable income.
5. As a natural monopoly and hidden champion, GW must expand globally to operate
efficiently, maximize its customer base and reap the rewards of high investment and
sunk costs.
6. GW should concentrate on strategies to raise barriers even higher, open more hobby
centres to further control the routes to market and limit the opportunity for geographic
competition by aggressively opening in as many territories as fast as possible, to
establish the first mover advertisement the business enjoys in its more established
markets.
7. Both in terms of the fixed costs of the hobby centres and also the cost of production,
GW should seek to constantly innovate and drive cost down whilst maintaining
quality of products and services alike.
8. Strategies should be devised to encourage buyers to engage frequently through
regular product releases and the constant generation of excitement and interest
through various hobby activity promotions.
9. In terms of supplier power perhaps, GW may consider gaining certainty through
forward buying and fixed price contracts.
10. GW could potentially maintain its competitive position by strategies which focus on
global expansion, a ‘laser focus’ on the offer in terms of investment research,

6. innovation; understanding their customers even better, vertical integration and
building in excellence in staff and corporate culture.
11. Expansion into more geographical territories and thus exposing the offer to new
audiences has already been identified as a key strategy and to do this requires the
crucial strategy of recruiting and training many more great staff members to populate
the hobby centres.
12. Although GW sees itself as a niche market which will always appeal to a minority, a
more sophisticated approach to the targeting of new customers may be appropriate.
13. The use of technology to allow customers to build unique information sets which may
be held on proprietary databases owned by GW would gain drive towards customers
commitment and lock in.
THREATS
1. Sales were down despite strong growth from the new Games Workshop Webstore.
2. They increased the number of Hobby Centres by 27 stores during the year, but the
growth from these was not able to offset the decline in existing stores.
3. As a niche business GW neither benefits nor suffers from macro economic factors.
The challenge is to ensure that all hobby centres deliver sustainable growth and
consequently enhanced recruitment, training and reward programme have been
developed to ensure more consistency in future.
4. GW must constantly innovate ensuring the hobby games platform is relevant and
competitive. If the hobby gaming platform becomes unattractive for whatever reason
them GW is doomed.
5. Dangers lie in similar local businesses becoming dominant in territories currently
under-exploited by GW.
6. Just as a niche marketer knows that quality is more important than price and that
respect for the customer is paramount, it also knows that mass-market advertising is
expensive and ineffective compared to the power of word of mouth.
7. Although GW is a monopoly, buyers may choose a different platform completely,
perhaps spending their income on computer games, historical wargames, train sets or
other leisure activities instead.

7. 8. It would be dangerous for GW to assume that because it is in a monopoly position, it
can seek to optimise its position simply by premium pricing, heavy investment in
advertising and neglecting innovation and development.
9. Risk of potential new market entrants, GW should make it clear that they would adopt
a very firm defensive posture against all comers-in terms of ‘chicken games’,
potential rivals need to know that GW will not be swerve.
10. Territories with large sales potential which GW has yet to enter, a focussed rival
could set up and establish a local version first. Thus the strategy of global expansion
must also have a degree of urgency coupled with clear prioritisation.
NOTE
• Key risk which faces GW are not external but internal.
• Not affected by economic factors.
• Performance shortfall has shown due to the quality of management and decision
making therefore all senior appointments are made internally.
Plans for 2010/11
• Use of a rolling 5 year planning process for managing the performance of GW.
• This has allowed them to focus on key issues facing each business and to put in place
projects that will have a long term benefit on their performance.
• Invest in opening more GW Hobby centres in Northern Europe, Continental Europe,
North America and Australia.