Originally Posted by
weeble1000
I'd like to preface this barrage of facts and opinions by quoting GW CEO's commentary in the 2009-2010 financial report, "We are not significantly affected by economic factors, as recent results show. Performance shortfalls in the past have been down to the quality of management and decision making." (CEO's Comments, 2009-2010 Financial report, pg 7, emphasis added)
While this is going on, Tom Kirby is making almost $800,000.00 per year in salary and benefits. This is a salary increase over last year and it does not take into account the value of Kirby's stock which, even considering the 18 percent drop, is worth something like 350 dollars per share. Kirby has nearly two million shares! Also consider the fact that Games workshop paid stock dividends this year to the tune of 25 pence per share. Admittedly, GW has been under pressure from shareholders to pay dividends, but in Kirby's case, and others of the top GW brass, that decision clearly had personal benefits. At about 40 cents per share, Kirby alone was paid almost $800,000.00 in dividends, which brings the total amount of cash he's sucked out of GW this year alone well over a million dollars and closer to two.
This is going on while GW's sales are decreasing, its profit margin is struggling to remain stable, and when it has little more than 17 million dollars in cash.
GW's response to falling sales was to jack up the price of it's products and cheerfully suggest to shareholders that this was because, "We know that, for a niche like ours, people who are interested in collecting fantasy miniatures will choose the best quality and be prepared to pay what they are worth." (CEO's Comments, 2009-2010 Financial report, pg 3, emphasis added) In other words, GW is trying to keep itself afloat by bleeding its customers. And let's face it, part of that blood-letting is paying Tom Kirby's outlandishly fat salary. Oh and by the way, Kirby's salary went up in spite of the fact that, "We set ourselves the objective to pay off our borrowings this year and we asked staff to accept a salary freeze to allow us to do that." (CEO's Comments, 2009-2010 Financial report, pg 4, emphasis added)
Now, Mr. Kirby's salary went up this year due to his "extra" responsibilities in coming to America to develop the market here. I should add here that this invariably involved paying to relocate him as he's in the states 40 weeks out of the year. Plus, he's being paid in pounds but spending in dollars, giving him the best of both worlds from his fat stacks of cash.
Considering this, let's not forget the ongoing GW v Chapterhouse litigation. Apparently, one of Mr. Kirby's extra responsibilities here in America has been to hire an awesomely expensive law firm to attack a small American business that is ostensibly adding value to the company's own products. We can forget, for the moment, the fact that GW's complaint (parts of it likely drafted by Kirby considering the descriptions of GW fluff) is full of boundless accusations that barely meet the prima facie requirement. We can also forget that the complaint is an intimidation tactic designed to frighten Chapterhouse into going under and terrify the rest of the legitimate small model company market (It was filed on December 21st with an 20 day period to respond even though the attorneys were unavailable until the end of this week).
Forgetting that, we can focus on the fact that this suit is the second pillar of GW's business strategy next to raising prices! "Our continual investment in product quality, using our defendable intellectual property, provides us with a considerable barrier to entry for potential competitors: it is our Fortress Wall." (CEO's Comments, 2009-2010 Financial report, pg 3) That's code for, we're increasing prices to account for fewer sales and we're suing the crap out of anybody that could conceivably compete with us in order to make our IP seem fictitiously invincible, so don't worry investors.
What does all of this boil down to? Games Workshop is attacking its customers and we are paying for them to do it. GW's business model assumes that its remaining loyal customers will happily pay artificially inflated prices and they are using that money to pay ridiculous management salaries and fund overly expensive lawsuits that attack the very community that they are depending on to accept price increase after price increase.
This not a healthy business model and I, for one, don't appreciate being squeezed by some British company in order to pay a corporate manager's fat salary and terrorize the hobby community. GW's customers need to send a message to GW that this behavior is not acceptable.