As EU backers continue not to like paying for shipping and tax, I thought I'd do a little exercise to check my own sanity on numbers for Gloomier. At this point in time, we have 212 backers in all EU countries combined. (This puts the EU in the aggregate as #3 behind US, GB, CA.)
In comparison we have 442 UK backers, so post-Brexit our EU market is less than 1/3 the size it was, which has a big impact on logistics, as everyone who suddenly found customs bills accompanying packages between UK and EU in January has learned.
So these 212 backers have thus far pledged $7868 toward shipping + tax, which is an average of $37.11 per order. It is not clear right now exactly what the total in pledges and add-ons is to go with that shipping bill. I'm taking a stab at saying $113 per order, as the average
of the $24+$50+$265 tiers. If that's a fair estimate, then we are committing to paying $22.60 in VAT at the border for the average EU order. (If we didn't pay it at the border, the customer would have pay the vat plus a service fee from the carrier, likely $8 to $20.)
Subtract $22.60 from $37.11, and we are budgeting only $14.51 per order for actual shipping costs. The VAT is unavoidable (at least after July 1, when the €22 de minimis exemption for VAT goes away; and our rewards won't ship until October). If we used fulfillment center inside
the EU, the hope would be that we could reduce that $14.51 per package cost. I do expect that we will average less than that for each package in the USA (we are charging $6 to $15 for the various tiers for in-US shipping). However, to use an EU fulfillment center we would have to
send the goods to Europe. Items in this Kickstarter are manufactured in the USA, China and Taiwan. We would need to have all the goods delivered to the US first, and then we would put together enough for the EU orders and ship them to the EU. This means EU fulfillment would take
place at least 6-8 weeks after every other destination around the world. The cost of shipping to the EU is probably a minimum of $1000, maybe more, if we have it consolidated as one LCL ocean shipment. So that means we have to spread $4 to $5 in cost to each backer to cover the
extra expense of moving the goods to the EU for fulfillment staging. Then we have to pay the fulfillment house their pick/pack/materials fee, which is likely to be $3 to $4 per order. At best, this leaves us about $6.50 to pay for in-EU shipping, to destinations from Ireland to
Finland to Malta. And that assumes no extra surprises, such as duties in general or retaliatory tariffs on US-manufactured board games. I'm also not sure if we would have to set up with VAT registration and an EU agent with ongoing reporting requirements and fees. So a best-case
scenario of using a fulfillment house in Europe to make this "EU-friendly" means adding a couple of months to the delivery time, having to charge even more than we do, and introducing a whole raft of uncertainties and dependencies on third parties (e.g., what projects are in line
ahead of us at the fulfillment center; do they get slowed or closed by a Covid outbreak; etc.). We can just control it much better in our own facility, it's a lot less work to coordinate, AND it costs less in the end. Even if we had a dramatic increase in the number of EU orders,
the VAT is going to be proportional to the value of goods. If we wanted to lower the average Shipping+Tax by $5 from $37.11 to say $32.11, we would have to get average fulfillment cost net of VAT down to under $9.50, which would be less than our average cost for shipping alone
inside the USA (with no fulfillment fees at all), where we are shipping 20X the volume. This is simply impossible.
Showing me another Kickstarter where the EU shipping charge is less than the VAT that should be paid on a pledge of that value, btw, does not tell me I'm charging too much; it tells me that publisher is doing something, such as charging everyone else in the world more in order
to subsidize the costs to EU customers. That's their prerogative, but to me it doesn't seem fair to charge more to backers in Hong Kong, New Zealand or South Dakota in order to cover the 27% tax rate on rewards to a backer in Budapest.
P.S. Back our Kickstarter! Only 4 days to go. And if you need multiple in-print add-ons, look at update #2 about ordering immediately from our website to optimize shipping calculations. kickstarter.com/projects/atlas…
(d'oh. #4 of course after #1 US, #2 GB, #3 CA.)
(Australia is next if anyone is curious, and has more backers than any individual EU country by a long shot. Not surprising for a text-heavy English-language game.)
Another postscript about Things Changing Lately: I already mentioned the pending disappearance of the €22 de minimis exemption for EU VAT, which will mean that a lot more Kickstarter rewards will be subject to VAT (and, if not prepaid by the sender, fees for collection). Brexit
has changed the total split the total shipping volume for a Kickstarter into two countries instead of a single market; as we've seen, this can mean that the remaining EU is less than 1/3 the volume it was before (at least in our case). We have better rates and alternatives in the
UK because we ship more directly to consumers there, and the volume justifies us setting up VAT registration and administration. Finally, a really important factor for a lot of RPG kickstarters (but not Gloomier) is that the UK has 0% VAT on books. This meant in the past that we
would use a consolidation service that would clear all of our EU parcels of an RPG book through a UK port of entry, where 0% VAT was charged. Once inside the EU, it was not subject to VAT when crossing internal borders; this made quite a difference when entering in a Danish port,
say, meant 25% VAT. Now those shipments may be entering the EU at Charles de Gaulle airport instead of Heathrow or Gatwick, so the French VAT of 5.5% on books (which is better than 20% on general goods!) applies. The switch from 0% to 5.5% means not only 5.5%, but also needing to
(a) use a service that charges the VAT back to us (which is a smaller range of price/service options than if it was zero-VAT), or (b) use a service that charges the VAT (and usually a service charge) to the recipient, which makes for unhappy customers.
The changing regulatory environment and Brexit are probably having a rude impact on some Kickstarters that had planned to be fulfilled before now.

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More from @JohnNephew

3 Apr
I love the art of Godsforge and there is a funny story about @KylaMcT and @boymonster that goes with it.
Kyla was looking for someone to illustrate Godsforge, and Cam recommended an artist that he had worked with before. So Kyla looked him up on Google and saw examples of his work, which was super distinctive and a striking visual direction for the game. She reached out by e-mail to
see if he was available and interested. He was! Deal was signed, fantastic art was produced, game went to press. Some time later, Cam asked, "So hey, were you ever going to get in touch with Diego?" and Kyla was like "Yeah! We signed him! You should check out the sketches!"
Read 7 tweets
19 Jun 18
Wow, there are morons trying to start a "DNDgate" thing. With complaints about "attempted SJW entryism of non-gamers into positions of influence over the hobby". What year is this? How long have I been in this industry...working alongside women, POC, trans...? Oh yeah 30+ years.
I've been a pro in this field longer than some of these whining fanboy manbabies have been alive, and they're complaining about the people taking "positions of influence" trying to do things like increase the diversity of representation in games like it's something new.
I mean, JFC, I remember as a freelance writer & editor for TSR on D&D 2nd Edition in the late 80s/early 90s, having WRITTEN GUIDANCE from the company about being thoughtful about increasing representation of women/minorities in the art direction for D&D books.
Read 8 tweets

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