IS PLAY N TRADE A GREAT FRANCHISE OPPORTUNITY?

Uh, it is a piece of poo.

Why not franchise downloading music CD’s and trading them?

Both are equally stupid business plans.

michael webster is an idiot who needs to get a life and learn about running a business. just because you shop there doesnt mean you know the industry…dumb ass

Here is the 2007 financials.

http://134.186.208.228/caleasi/PDFDocs/004788513.PDF

Let’s see 30 stores generating 80k in royalties or less than 3k per store.

Assume 1/2 stores open in 2006, so double the 3k to 6k. At a 4% royalty rate – geez, these guys are making money had over fist.

No Sean, the phrase is used in its universal sense.

Sean, I admit to the failure to appreciate the fine points of bankruptcy.

Matt:

How would anyone know be reviewing the 2007 UFOC that only 13 stores were opened in 2006?

I inquired about PnT but chose not to purchase. I sat on the con calls, spoke with the President but nobody can give any specifics regarding digital distribution. As broadban increases within the US, consoles will offer more and more downloadable content. Heck, you can do a LOT of it now. Developers continue to complain about making games for multiple consoles and PC’s. The president of Sony also said that he would be shocked if the PS4 had a disk drive. Nobody believed the music industry would let people download stuff right to their computers, why do you think consoles will be any different? Will it happen tomorrow? No, but it most likely will. I am not willing to sink my hard earned money into a 50/50 chance of my biz model becoming irrelevant overnight.

I sold my shares of Gamestop in the $60′s due to this possible problem.

Anthony,

I also dont believe video games will become 100% downloadable. However, I believe its in the best interest of game developers to strive for a single format. Think about all the money companies like Sony, Nintendo can save by closing all of their factories. They can save on the game boxes, plastic, cd’s etc. They could also cut massive employee overhead. Also, this does not mean the companies need to consolidate, they simply have to agree on a downloadable format which they can all use.

I like the idea of P N T, and I think you can make money with them. I just worry that the next generation consoles may damage the current business model.

I invest in oil and do not see demand destruction in the near future (2-5 years). If given the choice to download a cheaper game via my console, or get in my car and drive to the store, I will choose downloading everytime.

Downloading the game will most likey be cheaper (less overhead for the companies to pass on) hence returning a game to P N T becomes irrelevant if you’re getting the game cheaper from the start. I used to take games over to a friends house, but I am in my late 20s and that is something I no longer do, so that fact the game can only be played on my console does not bother me (I could always bring my console over…). Given the fact the average gamer is in his 30′s, I have to assume other 30 year olds arent hanging out gaming with each other (this is just my opinion).

Also, I am surprised that gamers still return games to stores. I simply sell my used games on eBay for a much better return…

The above are my reasons for not purchasing P N T rights. The decision is different for everyone.

Greg

I personally own 3 of them and it is the best investment I have ever made. If you find away to fail at this, your just a loser that would fail at anything. Just look at gamestop’s financials then decide if you can out sell an 18 year old on minimum wage. If you say no, stay at your dead end job or you will end up like john.

Again,
Read above about loser. Winner’s have beach houses, losers look for websites to complain on instead of working harder.

Chris,
I’ve had 3 other franchises and PNT support is the best by far. Some people just aren’t cut out to own their own business. And with every concept, instead of pointing the finger at themselves, they look for someone else to blame.

I would defer to the franchisees I know that came from GameStop. They say the PNT POS is by far better than that giant company. My managers learned in one day from the on-line training tutorials.

She’s right,
If your a pathetic loser, don’t invest in PNT, or any other franchise. I’ve been with 3 other franchises and PNT’s support is the best out there.(cold stone, fire house and curves).Look at Gamestops earnings claims then make your own decision, then ask am I a winner or a loser, then get in or stay out.

Marty,
Question-Does the support stem from Corporate or area developers? I was thinking about how you and Sophie (and partner) are polar opposites. It does not make sense…

-C

Marty, Sophie,
How long have you each owned a PnT? Is/was there a ramp-up time… It sounds like the support comes from 2 different companies… Sounds like you both work hard with varying results… Marty, what is the easiest was to summons corp support? Thanks to both of you for the real scoop.

Do you really think they would be selling/opening so many stores with a 1/5 ratio? Come on, look in the mirror and sell your store. List it on Bizbuysell.com tommorow. You’re just not cut out for your own business. No franchise is required to fly out to help you, but they still try to visit the stores as much as possible. I’m done with this exchange, it’s for whiners.

Marty,

Though I appreciate your words of wisdom, you should probably watch your tone, you stand the risk of sounding a bit arrogant. Lets recap;
- You mentioned earlier you’ve owned 3 other franchises, this being your 4th. How did the first, second or third one go for you?
- Unless you still own any of the other 3, we can assume they didn’t go as planned?
- For you to tell someone they are not cut out to run or own their business seems a bit off to me, 4 stores later.
- You also mentioned the founder of the business trained you personally…No argument there.
- Seems easy to say that the support is great when the founder of the company travelled to your location…
* Perhaps if Sophie (and partner) had 3 times the experience (learning from passed endeavors) I won’t call your first 3 attempts failures because most of the millionaires out there went through several trials to reach success. It’s about never giving up right? Not just quitting if the first attempt lets you down… In addition, if Sophie (and partner) received the same level of corporate support, i.e. trained by the founder…they may not have the angst. Thanks again for the insight, but based on your own angst and apparent self doubt, I’m happy to end this exchange. Not really up for any kind of discussion with the corporate puppet.

Semper Fi-

Sophie & Partner,
I am so sorry Marty was so hateful to you. I will graduate with my MBA in 6 days and my thesis is on Play N Trade. My professor has his PH.D. in management and we have been working on the PNT UFOC and financials for 4 months. I called corporate for information and researched everything I could find. The Play N Trade I went to did not have a play before you buy policy because the owner needed batteries for the game stations and he could not afford to buy them. He told me, a potential customer, that he was losing money. I felt so sorry for him I asked it I could buy a Wii but he did not have one in stock. As I looked around the store, “Out of Stock” signs were everywhere. I went to another store and had a similar experience and at the third store the owner tried to sell it to me.

I have a co-worker opening a Play N Trade. I wish she had not bought the hype. I have heard it as well and it is good hype but unrealistic.
My professor told me to tell my friend to “get out if she can.” It is not your business skills effecting your business. I have to defend my thesis and we can not even find a way to make the organization work. When I presented the company to my professor I thought it was great and he just smiled and said, “Let’s see how you feel at the end of the semester.” He was right.
Best Wishes

Marty, you are shill. Please be quiet.

Dale, where are you doing your MBA? Who is your thesis supervisor.

one of my co-workers opened a PNT about a year ago, and many of the above stories (good and bad) are very true. My co-worker and wife work ed many hours without pay. The store is now in great shape and self contained. Problems rose and they sacraficed and overcome and now have a staff to attend to the shop. I hope the best for all PNT new and old franchies. GAME ON

It is amazing to see how much time Sophia has to complain on a message board…shouldn’t you be focusing on your business. Doesn’t it benefit Play N Trade for you to be profitable? Seems to me that there are alot of owners in the system that haven’t even been open for a year. Correct me if I am wrong but it should take a year before you start to make money. As far as new games and consoles I heard that manufacturers barely make anything on the consoles and new games are low margin items for all video game retailers. Play N Trade has so much more than all these other stores. I know when I shop for games I only buy used….such a better deal. I love the PNT concept and see nothing but good things for the company and the franchisees that are able to grasp the concept. Small business is never easy and you really have to put your blood, sweat, and tears into it.

I have notice that alot of the owners of the PnT franchise in here aren’t really gamers. Looks like people who think, since the gaming industry is getting so popular why not grab the market when its hot. To be able to sale games you have to be into games your self. You have to have the experience of games likes most customers that would come to a game store. I have been to Gamestop/ebgames, some of the reps there know nothing of games, just to make quick buck cause their parents want them to find a job. Play the games, really take a dive into the gaming industry.

Just before people start flaming me, I come from a gaming back ground. My brother in law owns a gaming cafe. I worked for the gaming industry for 3 years, i have been playing games for as long as i can remember.

I believe to make this buisness go well, like how most of you wish it did. You have to know what you are selling, and to whom you are selling to.

Best of LUCK to PnT owners. Dont give up. You have to plant the seed and sacrifice time before you get to see the tree.

Sean:
I agree, and sorry for leaving that out. Kind of did that post in a rush. Yes, i agree about the part about knowing how to run a buisness also. And i also didn’t mean by knowing how to play the game, I meant knowing the gaming industry, and understanding what a customer needs or wants by relating to their experiences. Like when selling a car, you have to know the car, you have to understand the customers needs. You need some passion in an industry to really make money in that industry. I know a PnT owner in my area, and he wants to sell his store, do you know what he told me. He said he hates retail buisness.

All I am saying is that, starting your own buisness is hard, but you can’t start a buisness because you see that industry booming, you have to have some sort of passion for it. Maybe people here that are going to sell their store or not making well, it could be the Gaming industry isnt for you maybe you would be able to make money in opening something else.

I apologize ahead of time for the long post. 

I’ve been tracking this discussion for awhile and have found it very interesting. I’m looking into purchasing a PNT store and feel that most of the complaints about the company are a result of franchisees that may not know exactly what they were getting into when they started. I may (and probably am for many) be wrong on this, but it’s the sense I get.

I’ve called a few store owners to get feedback, and they say basically what people here have complained about – long hours, low pay (in the beginning), corporate won’t do everything for you, etc. It’s your “baby” and you need to work at it.

I’ve also been concerned about the discussion regarding the future of the gaming industry (going downloadable and all that). There is still such a digital divide out there and the high-speed internet is not available to everyone (and won’t be for awhile). I just read about TimeWarner limiting customer’s bandwidth too. I think people will buying discs for a long time to come (whether new or retro).

My biggest concern with starting a PNT now is (and Neil points this out), who would want to get into retail in these economic times? I read everywhere that the video game industry fairs OK through times like this, but can that last? Will people still send discretionary income on games? That’s my worry and the biggest reason I’ve hesitated so far.

Neil, you said you talked to a PNT owner looking to sell. Can you share where you’re from? I don’t have a lot of retail experience and would be interested in talking to the owner about his/her experience with retail.

Please keep this entire discussion going … it’s been very helpful.

Anyone who knows anything about the video game industry knows that money is not now nor ever has been in selling systems. Microsoft and Sony have both admitted significant losses in getting systems into the market because they make more on selling the games. They are going for an installation base. It is the sign up for XYZ cellular service and we will give you a free phone because they wil re-coop the costs over the terms of the contract agreement.

So to look at investing in a Play and Trade with the expectations of making money on new games is systems is flawed from the beginning. Play and Trade is set up much like a “Dirt Lot” used car dealership … the margins on used games is huge! Considering you can buy a used copy of GTA 4 from a customer for $20 and sell it for $50. That is the model! Tie in the fact that they are the only store that clean scratched games, allow you to play before you buy and, in my market, buy used cell phones and iPods, and you have multiple revenue streams.

Now, if you are a gamer, like myself, you need to look at Gamestop, who is the only true competitor, and ask “what are they not offering that I as a gamer want?” and it comes down to extras that you as a PnT franchisee can provide. Video game related toys, t-shirts, posters, swag, imports and you begin to offer something different that the mega store does not offer. Also, on top of the tournaments offer game saves, information on new games and release dates … become a freaking resource!! The Gamestops in my area are filled with employees that know nothing about any of this stuff other than what they have on their dry erase boards.

Let’s also not forget about marketing … there are soooo many affordabe ways to market to young males that it makes my head spin. Play and Trade is an excellent opportunity if you are a gamer who is passionate about gaming.

Finally, downloadable game will not be a realistic reason to fear this industry for quite some time. Bandwith has already been discussed and because you and I may have it the national average for high speed (DSL is NOT high speed ATM) is only about 28-30%! Add to that the fact that no current gen system has enough storage space to hold all of the games, movies and shows. This too will change but what will not change is the fact that over 80% of gamers want the disc. If something happens to their system or storage device they want a backup.

I am rambling and don’t have time for spell check so I apologize for my ramblings. But, I do want it to be known that from what I can tell those who are complaining are not gamers and don’t know how to reach out to gamers. Play and Trade, regardless of the earlier posters thesis, is a viable model if done correctly. Just don’t go into it thinking your bread and butter is going to be coming from new games and systems … that is not the PnT model no matter what you thought you heard from corporate and those who know nothing about this industry!

Folks let first and foremost say that I’m not a franchisee or an expert on Play n’ Trade’s business model. I am simply a customer and a gamer and probably fall into a very desirable demographic for Play n’ Trade.

I recently paid a visit to a local Play n’ Trade store here in Northern Virginia and to another store in Manchester, Mo while visiting some family.

A few things struck me immediately about the stores. First and foremost was the absolute lack of stock. Literally the shelves were bare or stock spaced out to try and cover up the obvious lack of games. The new games section was devoid in both stores of most of the current new titles for major platforms like the XBox 360, PS3 or PS2. The used games section fared a bit better and had more choices but in both stores the prices were painfully out of touch with the going rate for titles at places like GameStop/EB Games or online retailers like EBay or Amazon.com.

I’ve read many of the comments posted here concerning the “exploding video game market” and the profit margins of used games but if the stores don’t have games to buy how can they expect to turn a profit?

Granted I understand that I’ve only visited 2 stores, is this atypical for the company?

In my humble opinion the only way to compete with stores like GameStop/EB Games is to offer a better selection at a competitive price. I’ve been a gamer for most of my life – I’m 27 now – and can tell you that most of my buddies dislike GameStop/EB and would jump at the opportunity to support a new store; especially one that is locally owned.

In my experience GameStop/EB Games have some major shortcomings. One, the stores are not every very well organized. Games are littered all over the store and it’s a hunt to find a particular used title. Two, the stores are staffed by disinterested teens (usually) who are terrible at customer service. Three, more times than not employees of a GS/EB will insert their own bias or fanboyism into a transaction. I can’t buy a game for the PS3 without getting a comment about how, “it’s better on the X360″ or visa-versa. Four, GS/EB will not let you try a new game before buying it & the kiosk games are usually not new titles or the kiosks are broken altogether. Lastly and probably most importantly, most gamers get a sense that GS/EB Games are ripping them off. Of course that stems from GS/EB buying a used game for $20 (or less) and reselling it for $54.99.

After visiting the Play n’ Trade stores I really am pulling for you owners out there. I hope that your stores succeed and I hope that I can walk into one of your stores someday soon and purchase the games I want and maybe talk to another gamer and discover a new game or two. Good luck and I hope that some of you find my post helpful.

I must admit that I have not read ALL of the comments posted here. One thing that I have noticed with most franchises is that whether you have contact with corporate or not, they are going to let you handle things for yourself. Once they get a certain amount of money from you, their job is done and your success is dependant on you, your location, and your advertising skills, not a system designed for success. Im speaking from experience and realisticly. There will never be guidelines that will always work when it comes to dealing with other human beings. Human nature is not yet predictable enough to set up successful systems. All corporate is going to do is tell you “try this” and when that fails they tell you “try this” or “your not following the system.” I must say, I like how marty dropped off the face of the earth when he was questioned and provided no answers to anyones problems. Im not here to say anyone is right or wrong. I’m simply advising anyone who reads these comments to think in a realistic manner. Most franchises ARE all hype and you must get the customers to buy into thee hype as well.

At Disc Replay, we are a franchisor of stores that buy and sell used video games, used video game systems, dvs, and cds. Our company has been in business since 1994. 98% of what we sell is used. We do not bother with selling new games and systems. Our initial franchise fee is $12,500. Our royalty is 2.5%. We give a 5 mile protected radius. In our Franchise Disclosure Document, we use an item 19 Financial Performance Representation. We have had 3 company owned stores that were open for more than 12 months as of August 31, 2008. The volume for the 12 month period from September 1, 2007 to August 31, 2008 was as follows: $797,518 $747,418 $745,600. We do not represent that a new franchisee will acheive those numbers. They are merely a statement of fact about the volumes our stores have acheived.
We believe the used video game business is an excellent business. But we most importantly feel that a franchisor-franchisee relationship must be win-win. I cannot comment about any other system, but I can tell you that I believe we have a franchise program that is designed to be very fair. No matter what type of franchise you are looking at, you should look to see if the franchisor uses at item 19 claim. Also, ask existing franchisees what month they became profitable.

I own a Play N Trade. We’ve been open just over a year. Not only do we not make money on new games and game systems, but many times the distributors won’t get us hot new games on release dates (they say they are “highly allocated” — meaning they have sold them all to the big corporate stores — GameStop, BestBuy, etc, leaving none for us).

I know a Blockbuster employee who shared with me what they make on new game systems and games and it makes me sick — they get a huge margin of profit because they have their own distribution center allowing them to get a **huge** discount for buying in bulk. We have no corporate distribution warehouse…

The only way to make money with this model is shear volume. If coprporate would spend money on national branding (commercials & ads in gamer mags and online) instead of asking the franchisees to foot the bill for lame local banner ads, we’d all be a lot better off.

I’d only recommend this Franchise if you have at least $300k liquid assets to invest, a vast knowledge of games, have a lot of retail management experience, and you have another source of income to pay your personal bills.

PNT prides themselve in being the fastest growing franchise and that is their goal franchising. Not helping you succeed. Their claim to fame is “We are the fastest growing franchise” not the most successful. For every 4 they open 1 closes. The stratigy to let them open stores next to big box stores is not good. The pnt by my house opened 300 feet next to a target. Target is always stocked with consoles and accessories. PNT is not, so not only are they sharing revenues with target they are loosing.

LOL. You guys all drive me insane. I and my partners are the largest franchise holder in the PNT family. I have personally seen stores close and fail from other people. Let me explain the reasons.
1) Play N Trade let people buy a franchise that had no business having a franchise.
2) They went into the franchise underfunded
3) They whine and cry and expect Play N Trade to make it all better. Fact of the matter is that you are a self employed business owner. Stop your whining and “make” your business work.
4) Play N Trade is a new franchise in a great market. They have made mistakes. To error is human but they are working hard to correct them.
5) PNT is still small and does not hold the bargaining power “yet” to negotiate better contracts.

These are the main issues for failure. As a business owner it is “your” responsibility to make “your” business profitable not corporate PNT. We run 60-70% margins because we are smart and make our business work. I will give you all a few tips on how to do this.
1) advertise! Advertise to your correct demo first and foremost. Young new age rock stations are perfect. Sustain your marketing efforts. Second when youy advertise give a call to action. When you first open advertise the fact you are a local business that wanted to invest in your community. Advertise 50% more on trades for a week when you open. This will stock your stores up and allow you to get butts in the door so they can see just how great you are. Dont do live radio remotes. They do not provide a good ROI (return on investment).
2) even before you open your store get yourself a great commercial broker. Interview the hell out of them. Want to know how much we pay to open a store right now? 15,000 max. Why? The landlords are hurting terribly bad and need to fill their space. so we make them pay for almost everything plus give us 6-12 months free rent per location.
3) dont hammer on new merchandise. You dont make money on new. You make money on used. Used comes from trades. get the picture? Pre orders should be pushed by giving 20% more on trades when they pre order.
4) market your niche. Trade in cell phones, more for trades, repair systems, disc repair, try before you buy, local business.
5) People People People! No one can get a job you have the pick of the litter. Look for personality first game experience second. People come to stores not to just buy gamnes. You can do that all over the place. They will come to interact with the people they enjoy interacting with. Hire a dynamic personailty and watch your customer base grow.
6) Hammer your memberships. Membership e-mail and cell phone databases give you free marketing directly to your base.
7) sign walkers. We use them at every store at peak hours. We hire a sign walker for 20 hours a week at every store. It is well worth the 7.15 an hour you have to pay to get butts in your store. It is simply effective.
8) Signage! Negotiate for the big pylon space on the monument signs! You will get it. If they cant see you they cant shop you.
I would be happy to assist and advise any struggling franchisee in the system.
For the rest of you guys smearing play n trade… They are not perfect. The economy is terrible and I frankly dont know any business that is doing well right now. My corporation is making money even in this environment and I am in Michigan the worst ecoonomy in america. If we can do it anyone can. SO stop whining and take responsibility for your own failures and shortcomings and stop blaming other people.
Robert Meyers
CEO
Gamers Guild Holdings Inc

I think what people need to realize is that Play N Trade is really a relative new concept.

They seem to attract a ton of interest and really are one of the few franchisees in the country that are growing right now.

They have a great management team in place now and have made tremendous investments to take the company to the next phase.

From what I can tell any issues they have have been with franchisees that were ill prepared to properly fund or run their businesses.

I have talked to many of them and the ones that seem to be in the business in the more recently seem to have much better expectations of what it will take to be successful and have really good things to say about the company.

Its something that I am continuing to look at very seriously.

I just don’t see any industry that is near as sexy or has the long term potential that Play N Trade has.

All things considered is very impressive what they have been able to do in relatively short amount of time.

Bill stop whining. It is not PNT’s responsibility to do a franchisees accounting or do the marketing for them locally. Read the UFOC. If you look close PNT gives you all the tools you need to be succesful. You can lead a horse to water but cant make them drink. Yes the first 50 people in the system were quoted wrong on the cost to open a store. I was one of them. We had a shortfall of over 50,000 a store at the start. This has since been corrected. Once again PNT is not perfect and they are learning. Want to hear an interesting fact? Subway is a great franchise right? I mean they are huge! No way they dont have their act together. Yet one franchisee who had 40 stores, just failed and closed all his stores in Michigan. Mr Bill you also said a business doesnt make money for 2-5 years? You need to put down whtaever drugs you are on. I can find you a good rehab place if you want? Just that comment alone means you have zero business sense and you should not be polluting this blog with your ineptitude. It is people like you who fail when they get into a PNT franchise. So far you have whined, complained, blamed others and shown you have no business aptitude. I just scrolled up to see if you had other posts on here.. To my non surprise there you are with tons of posts on how terrible Play N Trade is. Did you own a store and fail? Maybe just maybe if you put this much effort into making your store run properly instead of blaming everyone else but yourself, you would have made it eh? Now please stop your QQ ing. QQing is a internet term for whining for future reference.

LOL you crack me up Empire. You just said it yopurself they made the mistake. Im not getting into a shouting match with you. Dont tell me I dont know business. I have currently 3 franchies and are looking for a 4th. Im not looking for an argument Im looking for an idea and for yo to come out and tell me Im on crack tells me im dealing with someone a little more younger then we assumed and yes this is a documentewd fact that it takes 2 to 5 years to show a profit. Also 7 of 10 new business close in the first two years. Eitherway here is my offer to you. Since your units are so successful I would like meet and show me exactly how to manage a successfull PNT because I really do want one. I can fly out anytime after Thanksgiving. Im in Florida.

Good points guys. This is what everyone needs to here. Don’t go into business under funded. I know they tell you what to have ready just in case but form the front lines or the owners in here what is a realistic amount you should have in your reserve? Also, can someone explain to me with the huge investment in Area Development, How do you recover that investment. Im not educated in the AD aspect of franchising.

Dear Mr Bill.

As I told everyone in the franchise system of Play N Trade. I am more than willing to assist and teach those who would like to learn. We would welcome you to any of our locations throughout Michigan and Ohio. We will have 10 stores open by the end of the year with 20 more slotted for next year. I can also assist with the selection of succesful sites and negotiations so you wont have to invest more than 25-40 grand to get into your store(s). We have a winning model for what we do and know how to implement it. I will leave my phone number here if any wish to give a call. Let me add one more thing. Ask me if I agree with everything Play N trade corporate does? No. I do not. When I ask them to correct a wrong they are quick on response. The CEO of Play N Trade who has also become a friend to me flew out here to Michigan to see us recently. Tom became the CEO of Play N Trade not too long ago and I gotta tell ya I am very excited about where he wants to go with this company and how he is changing Play N Trade. When we talked I went right down the list of the problems we are facing out in the field. From the initial cost, vendor relations, royalties on systems and sometimes having to go to a Costco to get merchandise because with shipping fees sometimes its less expensive. I showed him our model and why we are succesful, showed him how we only spend 15-20k to open a store now. Some of the problems he already had seen and showed me what they were doing to fix them. Some things they still need to work on. Make no mistake about it Play N trade needs to screen franchisee’s better. They cant let someone in just because they are waving around that franchise fee. Those bad franchisee’s are getting weeded out of our system slowly. The new ones coming in are more people like myself, people who understand business. I welcome any business person to talk to me about Play N Trade. Play N Trade is not a get rich quick scheme. it takes blood sacrafice, hard work and a steel will. With 10 stores that we have bled and worked and screamed for we will make just under a million dollars profit next year. We also have zero debt. Yes, this is net profit not gross margin. So in conclusion if you want some advice and really want to come into our family of stores please feel free to give me a call. Im not an AD and I dont work for PNT corporate but we could really use some more savvy people in the system to help me and others like me build Play N Trade into the powerhouse it is destined to become.

Robert Meyers
CEO
Gamers Guild Holdings Inc.
[Withheld]

No sales calls please as this is my private number.

Thanks guys. Im glad we all com to an agreement that we are not bashing PNT but trying to figure out whats good for the franchisee and ourselves.

Empire, sounds like you have a great “Empire” and am very impressed with your units being built for less then 20k out of pocket. I would really like to here how you do this and would like to replicate your model down here in the south. I do not want to waste your time with a wasted visit if you have a business plan you can share with other franchisees and prospective franchisees as myself. If a visit is required to see how you operation is able to put a unit in place I will call you and make arrangements to meet.

Thanks again guys!

It seems to me that the used video game business would be a good business to get into. A franchise like a Disc Replay or a Play N Trade offers consumers a chance to get good deals. More and more people are going to be staying home, not going on vacations, not going out to eat. I think a lot of people are going to stay home, eat frozen pizzas, and play used video games. It seems like Play N trade is expanding fast, and Disc Replay is up and coming. These businesses seem to be poised for the new economic realities.

Empire, can you explain how you open the store with only the amount you stated. thank you for your time

Sorry guys have not had time to check this posting in a while. Let me respond to a few of your questions.

My first response is to Jason.
It sounds like you are around one of the weaker Franchisees I was talking about earlier. If you would come to Grand Rapids Michigan you would see a much different situation where GameStop is reeling and on their heels due to our aggresive marketing and superior business model. You will always find our stores stocked and open. 95% of the time we have new releases released at midnight or the next day depending on the game and demand. Once in a while we will miss a drop date because of things that are not in our control. Keep in mind Play N Trade is a family of independant business owners. The bad ones weed themselves out. GameStop may be the big boys on the block and #1 where you are; that is not the case everywhere my friend. I will relay this information to corporate for you on the store not being open alot of the time though. They have a responsibility laid out in their franchise agreement that states they must have an open store. Thank you for the information.

In response to Bill.
Let me explain the culture of my staff and how I lay it out to everyone that works for me and maybe it will give you a better understanding of why I say what I do. We raise our children with the understanding that as long as you go in there and give it your best thats what matters. Think about this for a minute… As long as you try hard thats what matters. So if you try hard to get to work on time but don’t its the effort that counts? You try to pay your cell phone bill and the cell phone company says, well as long as your trying hard?! Nope they are going to shut your service off till you give them results. I train all my staff that it is about results not effort. As the great Yoda once said. You do, or do not, there is no try. Every employee also understands that we buy their time. We are an “at will” employer. We do not force people to work for us we give them the “opportunity” to work for us. As long as the employee is selling their time willingly to us and we are buying their time willingly we have an understanding. It does not matter if we have them scrubbing toilets, walking sign by the road, helping customers or even playing video games in the store to learn the product, we have paid for their time. We do not coddle our employees or accept the public standard. We expect our people to be the absolute best there is. We build leaders in work and outside of work. We are not a totalitarian work environment though. We care deeply about our employees and when they come to work for us they come under our wing of protection. We teach them work ethic and reponsibility. We explain to every employee from a sign walker to top management that their position in the company is based on their performance. Our managers we salary at $450.00 a week. This is not a lot of money. We set up performance based pay though. When they hit $15,000 in gross margin for the month they get a $500.00 bonus then they profit share 20% with the company after $15,000.00. We base these numbers on profitability for reasons im sure you all understand. Managers need to be thinking abour profit. Profit pays the bills not gross sales. They also must manage their shrinkage because that also affects their bonus. Performance driven pay is key to obtaining performance. Take this lesson with you for the rest of your life. If you want to make someone take ownership of the solution, you must first make them take ownership of the problem. I could go on and on about this, however, let me close this part saying this.. We are a no excuse company. QQing is not allowed. When I see people whining and making excuses it makes all the muscles tighten in my body. If people put more effort into solutions than sitting around whining, the world would be a better place.

Ok next on the agenda is Dee.
I open a store with very little moneybecause i think outside the box. I am a creative thinker and I don’t accept the mold or the caste system society enslaves itself with. When someone tells me no, it can’t be done. My answer is “why”? Look at the economy. People sit around whining about it. I take advantage of it. Landlords need to fill space. You can get amazing deals on rent and landlord contributions. I have also questioned all the costs in building my stores. I don’t use Play N Trade vendors to get my builds or interior fixtures done. I get them done for 75% less than they do. I get my 32″ 1080p LCD screens (they run $895.00 with PNT vendor) for $399.00 out the door. This includes a 3 year warranty which is important for commercial applications. I could go on and on about every facet, however, my fingers are hurting from typing this much lol :) Fact of the matter though is that the deals are out there. Never settle. Wen you start settling is when you start losing. Negotiate everything. My mother is a very wise woman. She told me once that a closed mouth never gets fed. No harm in asking is there? Well that is all for now guys. Keep your chins up, work hard, don’t settle. I’ll check back every so often and respond when able.

Robert Meyers
CEO
Gamers Guild Holdings Inc

Who are you Mr. Meyers? And where and how long have you owed these so called 10 play n trade stores.
I know all the big players in this game and I’ve never heard anything about you!

Interesting?! So how long after opening the original store did franchise sales start? What benefit is there to opening a game store as a franchise? In this niche market is there enough players in the area to have a shop? And why won’t any good gamer sit at home in the comfort of their own place and download or play games? Sounds like another feeble attempt at the ol’ franchiser get rich quick game. Think carefully before signing on the dotted line!

John
I have done the research on you and I am very impressed with what you have done. I do like the low franchise fee and royalties, this says a lot about your company. I will seriously consider you in my decision and will contact you soon to have a one on one conversation and come up and see your stores. Thanks again for all the information.

Bill,

Thank you very much. I am looking forward to speaking with you. I do hope you take the time to come and see one of our Disc Replay stores. Opening a franchise is an important decision, and it is always prudent to spend the time to look closely at all the options.

John

STAY AWAY! The profit margins are razor thin. I concur with the people that say that we have to buy product from our competitors because there is basically no distribution system in place. I found a wholesaler on my own which has helped. There is ZERO marketing from corporate. The corporate representative that I am assigned is a petty, small man who offers nothing but headaches with his drama-queen type attitude. You will easily sink over $200k into this business and will not see a profit unless you are VERY lucky. I have everything in place to be successful but have seen ZERO return on my investment since opening. STAY AWAY or you’ll be sorry.

Ed and Jeff,
I think I read in their FDD that you can use any POS as long as they have access to it through the internet/VPN. I would use what ever the standard is. This way if they had good support they could run reports for you and tell you suggested MSRPs, Old inventory that needs to be bought back, trends and so on. There is a benefit to using their software.

With PNT you should do some research on how they changed their model this past few months. They have gone through some changes because of their store failure rate. Maybe explore some of the other franchises. Gamer Doc is growing slow so they may be more attentive to your needs. Their new stores are designed for social gaming. Replays has a successful model but their branding is a little off. Also Game On is new and my fit your needs. I saw on there website they have other services other then retail. Just some suggestions

I must say, they are a persistent franchisor. I contacted them about two years ago and still get emails. Having worked for a very large Franchisor (20 billion a year – some of the biggest brands names in the Hotel and Real Estate space); I can confirm that franchisors are interested in selling franchises. Some franchisors care about their franchisee’s (a 20 billion a year Franchisor care – because at that point, the franschisor’s revenue stream is from the monthly royalty fees, not the start up ante). If you remember Quizno’s – it hit the franchis world like a ton a bricks, people lined up and invested 200K-300K to open up a subway knock-off. You can get many open and operating Quizno’s for under 75K nowadays.

With respect to PnT, their differentiator is their events. Plus, the margins are only on the used games, as the 4% gross margin on the new games essentially goes straight to PnT as their royalty structure is in the > 4% range. So you’re paying for a concept, and if you live in any decently populated area you have a ton of competition. GameStop and EbGames (same company) along with Best Buy, and Toys r Us own the video game market in my area.

Betting on the used game market to make a living is simply a bad business model – I get that it works for company owned stores like GameStop, but they get to keep the margins on the new games, where at PnT you turn new game margins over to the Franchisor.

Franchising is tough – I think the best advice is to adopt the herd mentatlity like what happended with Quiznos. I see/saw that with PnT which is why I begged off. If you’re going to Franchise, get with a Franchisor where the majority of their revenue is NOT franchisee start up fees.

This site is just a joke… it is not written by concerned people that just want to be helpful with their advice… it is basis…it is basically a PR stunt by GamerDoc and the other copy cat companies that are trying to convince you that Play N Trade is not a good investment….but theirs is.

Just be aware that GamerDoc hires bloggers… use its corp staff to type this BS all the time….

It is too bad they don’t have any real value they can offer to potential franchisees aside from bashing Play N Trade… they only have 4 stores… do you think they have any buying power with the publishers or vendors…. Do you think they get any allocation in product.. any MDF money or Price Protection… they are a joke…you would be better off opening your own Video game store and saving the royalty you have to pay them…

Ask them…. Who on their staff has any real video game experience…who?????

GamerDoc PR.
Not sure who you are and I know most of the people who worked at Gamer Doc because I am the President, so it is obvious that you do not have much to say good about Gamer Doc. However you also are malicious enough to use Gamer Doc in your tag.
We hope that everyone interested in the Video Game Business look at all the competition and pick for themselves. We believe the failure of any franchise harms all of us in the industry. And most unfortunately generally the person loses their home and their credit standing.
Please, this business is a business first and may not be for everyone, I can only ask that you realize the anger of Gamerdoc PR and be careful at any investment.
As far as my credentials in business, franchising and gaming it is all public information. Please find out for yourself and I know people in all of the above mentioned chains and we at Gamer Doc wish them and their franchisees nothing but success. My email is jbelanger@gamerdoc.com and I am more then happy to speak with any of you.
Much success to each of you in your life.
Jim

John,
I was reading somewhere that your franchise fee is $12,500. What is the advantage of keeping your fees so low. In my mind it seems to limit the resources for franchisee support. I have been looking for a franchise for some time and since I have little start up capitol this is a factor in my investment. Also why would you keep opening corporate stores? Seems to me that corporate saturation would have a negative effect on attracting franchisees since you would be more inclined to favor corporate stores to grab more profit.

I was prepared to purchase a franchise last year but waited to long and lost alot of money in the market. I lost 65% of my investment and has effected my overall net worth and you know what that means, loans are almost impossible to get now and cashing out is not an option at this poin. Does anyone have a suggestions for me. I thought about getting a partner is this a good Idea? If so do you have potential franchisees that are under funded that you could partner up with me.

Thanks in advance!

Just some correction points here. . . 4% on new games is no where near accurate, according to many sources, many PNT franchisees, and the numbers Game Stop puts out. The average margin for new games, according to what I am hearing from PNT store owners, is about 15% (before royalties).
I have looked at Game Doc and Play and Trade, and what struck me about PNT was their amazing industry experience, especially in contrast with Gamer Doc (which has none). Their CEO used to be really high up in Game Stop, and they have a lot of people that have worked in this industry. I have decided I am going to do a PNT here in Oregon soon.

do the math. here’s a scenario for you: if your future pnt store is lucky enough to do say $50k per month, and your average GP for new merch + used merch is 30% (which is actually BETTER than Gamestop’s %), than you have 15k to play with at the end of each month. rent + misc operating costs+ royalties will run about $10k per month. labor will run minimally 2500 per month. hmmmm, that leaves you $2500, less taxes, for a $130k investment (and a lot of risk).

in socal, which has more gamestops than anywhere else in the country, pnt has already seen store closures, including 2 in irvine, one of which cost the owner $300k and was originally going to be pnt’s training store. another store was approved by pnt corporate for a franchisee even after 3 other franchisees had passed on the location.

i recommend to all of you considering this franchise, or for that matter any video game store…..think long and hard about your decision, and ask some very aggressive financial questions of many current store owners….ask about how they are making money, what their bills come to each month, and what gross and net pretax profit margins they are actually experiencing.

i think you may be surprised at the answers you get.

I own a PNT and things are going really well. Each owner controls his/her own destiny. This business model is not build for owners who want to have a bunch of kids running there business. It takes LONG hours and dedication. If you have never had any experience with ordering inventory or the video game industry, I’d stay far away from opening up a video game store. Gamer Doc is not a major player in the video game industry. They have a few stores and it will take them years to make any type of splash. I’d put disc replay and Game On it that class too. Out of all the video game franchises I looked at, PNT is by far the most well organized and banded names out there. Retail is a tuff sector to get into in this economy. GL with any choice you make. Just make sure you have at least 300k getting into any of these options.

Does anybody have information on how many play n trade franchisees closed their stores in 2010?

John,

I had been looking at a Play-N-Trade franchise for a while now. I decided to look around prior to making a decision. In reading the comments by Bill I did look at the other two opportunities mentioned and as a result of his comment skipped your company completely. In returning here to see what else might be listed I came across your reply. Of course it is well stated and brings forward some valid points. I will be taking a look at your business opportunity as well.

Regards,

Jeffery Williams
http://www.linkedin.com/in/jwilliamsoh

Play N Trade is a joke. I went in to talk to an owner about his store. What i heard was shocking. Play n trade does not have a distributor or buying power. He was responsible for ordering his own games. I went in two days after ufc undisputed was released. I wasnted to pick one up but the owner told me they only received two copies for each platform. I couldn’t belive that a gamestore would only receive two copies of a big title such as ufc. For the forty five minutes or so not one customer entered the store. The pricing was high and the owner told me that play n trade provided the software that updated pricing. But when toys r us sells new games cheaper than play n trade sells them used you have a problem. I wouldn’t waste the time in buying one of these franchises. I could tell this owner of play n trade wishes he had not as well.