Kickstarter Lesson #184: How Many Units Should You Make?

28 April 2016 | 25 Comments

Consider this scenario: You’ve successfully funded your crowdfunding campaign to make a new product. The survey data indicates that backers pledged to receive a total of 1000 units of the product. How many units should you make?

There are lots of different answers to this question, and it may vary by industry. What I can offer you today are some questions to consider as you make this decision, as well as some insights into what I’ve done.

These are the questions to ask when you need to send a final order quantity to your manufacturer.

  1. How many units did your backers order? This is your starting point. Consider adding about 5% to the total of each version of the product to make up for errors that happen during the fulfillment process.
  2. What is your minimum print run? Every manufacturer has a different minimum quantity that you must produce. For board games, this is usually around 1000-1500 copies.
  3. What are the economies of scale? The more units you make, the less the cost per unit will be. This may factor into your decision, as there can be some pretty big decreases in cost. A game that costs $16 to make at 1000 units may drop down to $13 at 2500 units.
  4. How many units can you afford to make? This depends on how much money you raised. Your Kickstarter funds may allow you to make many more copies than the backer rewards, so it’s a choice for you to walk away with a little profit or to invest it all in the biggest print run you can afford. Remember to deduct estimated shipping expenses from the funds raised before deciding how much money you can allocate to the first print run.
  5. Do you want to make a second print run in the future? One consideration is if you want this to be a one-and-done product or if you’re hoping to make multiple print runs. If the latter is true, your calculation must take into account the expense of a second print run. You’ll need to make enough retail units for the sales of those units to allow you to afford a second print run. Randy Hoyt wrote a great article about this.
  6. What’s the risk in overproducing? If you make more copies than you can sell, you’ll have a bunch of inventory just sitting in a warehouse somewhere. This is a good reason to only use funds raised–not personal funds–if you can help it.
  7. What’s the risk in underproducing? Other than the risks you’ve hopefully avoided by heeding points 1 and 5 above, the risk here is that you vastly underestimate the retail demand for your product. You haven’t lost money, but you’ve lost potential sales when the product is hot. The buzz may die down by the time you can reprint the product.

Here are a few stories about what we did:

  • For the original print run of Viticulture, I needed about 1300 backer copies, and I made 2500 total (800 were for retail). I was surprised and delighted that those 800 copies sold out to distributors on the first day. I didn’t reprint Viticulture until the Kickstarter campaign for Tuscany about a year later, which was well after the buzz died down. However, it was long enough that there was pent-up demand for Viticulture, resulting in a strong start for the Viticulture/Tuscany combo.
  • For the original print run of Euphoria, I needed 5700 backer copies, and I made 9000 total copies (3300 were for retail). It took several months to sell through those copies, and just as we sold the last copy (I think it was in May 2014), Euphoria was selected as one of Mensa’s games of the year. Suddenly we had lots of interest–including a buyer who wanted 1000 copies–but we had no games to sell.
  • For the first Treasure Chest, I needed about 5000 backer copies, and I made 7500 total. I didn’t realize how much of a niche product the treasure chests would be, and it’s taken a long time to sell those copies (over a year). It’s for that reason that on subsequent treasure chest projects–including the Token Trilogy–I only make enough copies to cover pre-order demand plus 5-10%.
  • For Between Two Cities, I needed 7300 backer copies, and I made a total of 10,800 (3500 were retail games). We sold through them in about 2 months, and we’re currently on our second print run.
  • For Scythe, I needed about 21,000 backer copies. It’s a very expensive game to make and we had strong retail support during the project, so I only made 5,000 retail copies for distribution. We’ll find out in a few months if that decision was correct. :)

What do you think? Did I miss some important questions/considerations? If any creators want to share their experiences with determining the size of their first print run, I’d love to hear about that in the comments.

If you’re interested in watching me talk about Kickstarter, particularly in regards to board games and marketing, here’s a video of a recent discussion I had with a group at the University of North Texas.

25 Comments on “Kickstarter Lesson #184: How Many Units Should You Make?

  1. Good thoughts, Jamey, and I appreciate the link to Randy Hoyt’s article(s). His thread on that was extremely insightful and very helpful.

    So far I haven’t been in a position to question whether or not I was doing more than the minimum print run, but I did want to chime in, if you don’t mind, and underscore the importance of calculating that fulfillment shipping into the funding goal. That was my biggest mistake on our first KS campaign. We thought shipping would be easily handled, since we were printing (500 units) x ($25) each and only needing to fulfill something like 120 backers. So we proceeded under the (mistaken) assumption that we’d have the extra (380 units) x ($25) = ($9,500) to pay shipping costs.

    Wrong. We didn’t have (380 units) x ($25) = ($9,500). We just had 380 units. Inventory with the *potential* to be sold, but which was not liquid and could therefore not pay for shipping on the initial 120 units. And we just barely made our funding goal, so we didn’t have any leeway, and we paid all those shipping costs (and a couple of other mishap expenses) out-of-pocket. Ouch.

    For our second campaign, I devised the following formula to determine a funding goal that would be the absolute minimum to manufacture and fulfill all backers, even if every single backer only pledged the smallest increment to receive a game and nothing extra. Perhaps you and your readers will find it useful, and/or it can spawn further discussion:

    minimum Backers needed at minimum Pledge level = manufacturiung + (Shipping * Backers) + 10% Fees

    bp = m + (sb) + .1(sb)

  2. Jamey – thank you for sharing this content; as this is exactly the conversation our team had last night. We’ll be at GenCon in Entrepreneur’s Alley with our first-run, self-funded game, and we’ve been debating the number of copies to print for sale at the show. Our plan, to take some of your previous advice, is to leverage our success at Gencon by building our following/base and ride that momentum to launch Kickstarter’s for our follow-up projects.

    Additionally, what I found valuable, was your conference call/video with UNT. A good overall Q&A with valuable content.

  3. Jamey,

    Thanks for posting this. I can’t believe that nobody has posted on this yet, yet here we are. One of those overlooked taken-for-granted topics I guess. So thanks for covering it.

    Adding to the discussion some points to consider:
    -Unfortunately, Stonemaier games’ games don’t reflect normal industry activity. Your popularity was strong (probably stronger than you realized) when you started Viticulture due to this blog. Selling out the first day is a rare awesome event. Very few others will experience that. Though I wish you all would!
    -General advice that Impressions Consolidation gives is: “600”. “I want 600 for distribution. Your game might do better than that, if you print more it’s your risk.” ~ This is based on a 600 to 1100 backer Kickstarter. If you’re much more popular on Kickstarter, you’ll be more so in retail. If you’re less popular on Kickstarter you’ll be less popular in retail.
    -If you overprint, you’ll have to pay storage costs. If you print +2000 and only sell 600 in the first year, then you’re storing 1400 for …who knows how long. Most games drop to “dead in retail” within a 3 to 8 months. You might burn a lot of copies eventually (or donate to a favorite con).
    -Many games drop to less than 20 copies being moved per month after the first few months, often as low as 10-, as stores are stocked and the craze levels out. 30 is good. More is great.
    -The King’s Armory sold out 1100+ extra copies in retail in 5 months. I said “Oh man I should have printed just 500 more!” The response I got was: Consider… 500 big box games is about 3-4 pallets. Hope for keeping a decent rate of sales of 20+ per month. This is going to take 2 years (500/20=25months) to sell through them all. …Where are you going to store 500- games for the next 2 years? Distributors don’t wanna hold that much stock that long.
    Finally, if we’re looking at a 5x model (referencing Hoyt here), and looking to reprint… nobody has talked about profit yet. Have you paid yourself for your service of bringing a great game to market? You should do this from your retail sales, you deserve it! How much, well that’s up to you and your day job. : )

    John

    1. I appreciate that last bit about “paying yourself” and profit. It’s important. Many times you get the impression/expectation from backers that every penny above and beyond the goal should be automatically spent on a stretch goal or some other such modification, to the point where you never end up with any profit. While I am absolutely in support of bettering the game and making it as good as it can be–even better than expected–there’s much value in trying to turn a profit that can be reinvested in the *business* overall, rather than an individual product, leading ultimately to more projects down the line (if all goes well).

    2. Want to highlight the storage costs. That’s a really good point, it’s a sunk cost that only eats profit, and it also exposes you to potential shipping price increases.

  4. I appreciate all of the great insight here gentlemen! There is certainly a LOTof information to digest. I’ve been working 10 years as a game creator and (finally), our first KS campaign will begin in late July. I’m certainly hoping to apply all of this great information to my business. Thank you for sharing and inspiring!

  5. Jamey,

    I’m listening to your North Texas talk and wanted to ask you a question based on a couple of things you mentioned during that talk. I am in the midst of creating a baseball simulation game. Every game that I have come across in that genre, Strat-o-Matic, APBA, Pine Tar Baseball, Pursue the Pennant, etc., etc. have player cards that are of low quality and are dense with print. In terms of my game being unique (an item you mentioned in your talk), I want to move away from that. Aesthetics have become such a huge part of game design/production. Ideally, I want my game to have high-quality, well-designed cards and the game mechanism makes use of that design.

    As I do my research, though, I am finding that perhaps the reason these other game companies use low quality cards are due to costs. My game set will have about 300 player cards. I’d love to use tarot size cards but even getting down to poker size cards, I seem to be faced with costs of about six cents a card which comes out to $18 in card costs, never mind other components. Using the 5x multiplier you mentioned, this game will be approaching $100 in price, a level I am not comfortable charging and one I don’t think the market would support. I am immensely frustrated with this as I see card-centric games, say, Dominion or Cards Against Humanity, not approach those costs. Heck, Scythe has half the number of cards my game has and they are just a portion of the game. Am I missing something as far as pricing/costs goes? I’ve looked at many companies that produce cards for games and the costs seem to be the same. Can you give me an idea what I may be missing? Am I doomed to making concessions on this and lowering my standards?

    Thank you for any help or suggestions you can provide. I really appreciate it.

    1. Jon: Thanks for your question! I appreciate you posting it here. Are you familiar with Baseball Highlights 2045 and Bottom of the Ninth? You might want to check them out too for your research.

      I’m not sure which manufacturers you’re looking at, but cards are quite inexpensive to make. I would recommend that you get a quote from Panda Game Manufacturing. They’re the company I use and trust, and I would estimate that a game with 300 cards from a company like Panda (which offers high-quality cards) would cost much closer to $5 to make (even lower depending on how many games you make).

      1. Jamey: Thanks for your response. I am familiar with both games you cited. They are more the style and quality of cards I’d like to use but are a different genre of game. Mine is the replicating of actual statistics of actual players.

        The companies I looked at were places that people on BGG had recommended; Drive Thru Cards, Game Crafter, Makeplayingcards.com, Printer’s Studio and many more. They all were coming in around the same price point. I will definitely get in touch with Panda. Thank you again for responding and for the recommendation.

  6. Hey Jamey, thanks for a thought-provoking production-oriented post. I wanted to ask you to speak to the Viticulture campaign. I noticed a few months after delivery that unopened copies were going on the secondary market for $100 to $120, which is definitely pent-up demand. Would there have been a difference for Stonemaier if you had made a much larger print-run the first time and satisfied that demand earlier, rather than taking two print runs to do so? I know that’s totally hypothetical – and would have gone against your business acumen – but I’m curious your thoughts. I suspect that the desire on the secondary market only helped the Euphoria campaign. Also, is there a risk with scaling up an order to meeting delivery time?

    Lastly, there’s a relationship between scarcity and price. I suspect that price point dominates any discussion of quantity in the board game market (and the opposite holds in, say, artistic Bicycle decks), but is there room for a “Scytheculture: Limited Mega Collector’s Edition” with a $200 price point, for example?

    1. JT: That’s a good question. At the time, we had some KS exclusive elements in the version of Viticulture that was selling for that much (as you know, we no longer do exclusives), so I think they played the biggest role in the high prices. As for any impact the scarcity had on price inflation, I’d much rather people pay a normal price for our games.

      As for very expensive premium games, we’ve offered something close to that on both the Tuscany and Scythe campaigns. I guess the next step would be something like the $300+ Smallworld game in the giant wooden box. I admire that level of craftmanship and wouldn’t rule out us doing something like that someday as an “anniversary” edition. In general, whenever I offer a collector’s edition of one of our games, I consider that to be the final, nicest version we make. Otherwise it just seems a little misleading to people who think they’ve bought the best, nicest version to then come back and say, “No, wait, there’s an even nicer version now!” Does that make sense? :)

  7. Some excellent points here Jamey! I had never considered warehouse fees when producing extra copies. It seemed logical to print as many as you can afford with the KS backer money raised, but this is a fantastic argument for limiting the number a little.

  8. Hi Jamey, I am taking a Management of Operations class in grad school right now, and was wondering how you estimate what your demand will be for retail? Is it based on print-run levels, or what you made from the backers? Or is there a forecasting model that you use? Just curious after having learned a little about this in class!

    1. Hi Josh: All of the factors I consider for a retail print run is detailed in this blog entry (that’s the entire point of this entry). Perhaps I’m not understanding the question–could you read the entry and rephrase what has not already been answered?

  9. Hey Jamey,

    Great blog. I’m finding it super helpful, especially the Kickstarter stuff, for my own game I’m designing right now.

    Noticed you used Panda Games for Viticulture. Did you stick with them for your other games? I like the result based on the copy I bought recently (though maybe you found a different manufacturer for later runs?) and I get the feeling our run might be the same numbers as your initial run for Viticulture.

    Were you happy with your dealings with Panda?

    1. Oh yes, I’m a huge fan of Panda. We’ve worked with them for all of our games. Their quality is excellent, their prices are fair, and their customer service is fantastic. I highly, highly recommend them.

    1. Alexander: Thanks for your question. I think it depends a little on timing (whether you’re releasing the expansion at the same time as the game or a few months later). But overall, my production quantity for expansions is usually respective to about 30-50% of the total base games in circulation. You can always print more. :) (Though, expansions are usually cheaper to make than the base game, so having a dud expansion is a much softer financial hit than a dud game.)

  10. Thanks Jamey, from reading this blogpost it appears you have to balance production cost with shipping cost and potential interest from gamers and retailers, does that sound about right? How do you establish the level of interest in a new game before release without the benefit of backer numbers on KS?

    1. Steven: That’s correct. If you don’t have backer numbers, it’s a lot more difficult to gauge demand. You can use metrics like Facebook followers (of the game), e-newsletter subscribers, polls, etc. I often ask our subscribers to see how many of them are interested in a game. But it’s still a shot in the dark.

  11. Thanks very much for your responses Jamey, it’s incredibly helpful for a fledgling dedigner such as myself to be have somewhere to go to ask these questions.

Leave a Reply to JT Cancel reply

© 2019 Stonemaier Games