izards of the Coast (WOTC) has made some bold moves over the years, but one that stands out for its impact on local game stores is the removal of the Manufacturer’s Suggested Retail Price (MSRP). While this might have seemed like a small shift in the grand scheme of things, the effects on the back-end costs for stores were anything but small. As WOTC's profits soared, the local retailers who have been the backbone of the Magic: The Gathering (MTG) community have been left to grapple with significantly higher expenses, all while seeing their margins shrink.
In a typical scenario, the industry standard for retail margin sits comfortably at around 45-50%. This is the cushion that allows stores to cover overhead, staff, and other operational costs while still making a profit. However, since the removal of MSRP, local stores have seen their margins plummet to a much more modest 30-35% on average. That’s a stark contrast when you consider the rising costs of product acquisition, which has pushed many stores into a financial bind.
WOTC, on the other hand, has seen a massive uptick in profits. By removing MSRP, they effectively put more pricing power in their hands, leaving stores to compete with a shifting market. While WOTC has now reinstated MSRP, the damage has already been done. The new reality for most retailers is that their back-end costs remain as high as ever, but their margins are still painfully thin.
But the problem doesn’t end there. Despite the return of MSRP, WOTC continues to ignore calls for Minimum Advertised Price (MAP), something other companies in the industry have adopted as a way to ensure fair competition and pricing. MAP pricing would prevent WOTC’s own retail channels or larger distributors from undercutting smaller, local stores. But for over a decade, these calls have gone unanswered. It’s left local shops in a position where they have to compete not only with each other but with WOTC’s own direct-to-consumer sales.
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