Adding a new product line is one of the most straightforward types of expansion – buy new products and then sell them. However, there are some essential things to consider, mainly centering around which to begin carrying. With a myriad of options available, choosing the best new product lines warrants some time devoted to research and consideration. Some critical factors to think about include the product cycle, storage space requirements, the degree that the new product line overlaps with your existing customer base, and the ongoing management requirements that the new product line will create.


Product Cycle

In this industry, a lot of the products we carry are at least somewhat cyclical. An example would be Magic: The Gathering and its set rotation model. With Magic, for many stores, the product release that accompanies set rotation is often one of the most undersold sets of the year, leading to lower sales and reduced performance in that month.

When considering a new product line, be sure to research the new product’s life cycle and compare it to cycles for your existing products. Especially with your first few expansions, try to avoid products that too closely mirror the life cycles of your current product lineup. Ideally, look for a new product line whose life cycle complements your existing lines. If your primary product line tends to have a weak third quarter, an ideal product line to consider adding might be one that leans toward having a solid third quarter, thus giving you a more stable cash flow throughout the year.


Storage & Display Space

An often overlooked aspect of expanding into new product lines is how to display and store them. The idea of having more diverse product lines is attractive and seems so much easier than the costs of other types of expansion, but if you can’t display the product in such a way as to sell it, then much of your potential upside is lost. For example, adding a different TCG to your lineup might require minimal storage and display space. However, adding something like a miniatures game line with dozens or hundreds of SKUs might need more space than you can realistically allocate to the new line. Therefore, the size of your facility and what products you already carry can play a huge role in what products you can and should consider for expansion.


Customer Base Overlap

When considering a new product line, consider how much your existing customer base will be interested in the new line versus how many new customers it will attract. Customers tend to have a fixed amount of discretionary income, so existing customers that purchase the new product line may reduce their spending in your other product lines by a corresponding amount.  However, new customers represent your increased income from the new line.

If too few of your existing customers are interested in the new product line, it can take significantly more time and effort before the expansion will pay off. Conversely, if too many of your existing customers “switch” to the new product line without drawing in new customers, then you may not see any increase in revenue at all. Current customers at least partially switching to the new product line make it easier to grow a community since you will start with at least some loyal customer base.

A case can also exist where a large portion of your customer base switches to the new product line while also attracting a substantial new customer base. In this case, it might be worth considering retiring the existing product line to favor the more profitable new product line.


Ease of Managing the Product Line

The final point to consider before adding a new product line is how difficult it will be to manage. For example, how hard will it be to build a community around the new product line (assuming it is a line that will encourage repeat customers rather than one-time purchases)? Employees will need to have at least some degree of training to sell and manage the new product (will they need to pitch it to new customers, or will it mainly sell itself?). In addition, if it is a TCG that you will also be selling singles for, your employees will also need training in how to price singles for both purchase and resale.  

How many SKUs will you have to track and manage inventory for at a time? For example, many standard TCGs only have a few “active” SKUs, plus several legacy/out-of-print SKUs. By comparison, something like a board, card, or miniatures game with a frequent expansion schedule might have dozens or even hundreds of active SKUs.


A Way to Improve Success: Community Organizers

One thing we have found to be helpful when adding new product lines is to hire a “Community Organizer.” A community organizer is a part-time staff position (our COs average 4-5 hours per week) whose sole focus is on making a single product line successful. Ideally, your Community Organizer is someone who is already known and respected in your local area’s existing community for that product line. The Community Organizer can help with tournament organization (and light rules adjudication) and can also provide a lot of additional invaluable services for making a product line successful:

  • Training for existing staff. Having someone enthusiastic about and knowledgeable of the new product line can dramatically shorten the time it takes to get your existing staff up-to-speed to sell the new line, shortening the time to profitability.
  • Targeting social media and advertising content for the new community.
  • Stock and Inventory management. Especially for product lines with large numbers of SKUs, a Community Organizer can help you keep track of new releases and advise on stock levels for products that are or will soon be in demand in the local community.

Our Community Organizers typically work an average of 4-5 hours per week, mostly centered around tournaments or events for their specific niche. Most of them do not operate a register during their time, focusing entirely on a positive customer experience during the event. We first tested this type of position when we expanded into a miniature wargame line and have seen tremendous success with it to the point that we are also hiring organizers for many of our existing product lines.

Adding new product lines to your inventory can be relatively straightforward, but there are some things to consider when deciding which new products to carry. First, make sure you have sufficient capability to store and display the new product line to its best advantage. Second, verify that the new line will draw in enough new customers to justify the costs of carrying that product instead of a different one. Finally, consider hiring a part-time employee specifically to help launch the new product. Taking some time to prepare and select the best new product line to launch will ensure maximum profitability for your store.