Play Meter

PLAY METER: With the current Hit Syndrome which is
rampant in the country today, we hear some talk that
distributors are forsaking their responsibilities of
salesmanship and are becoming mere order-takers
instead. Would you agree with this general assessment
of distributors today?
RODSTEIN: I would hesitate to answer it for all
distributors, but it seems to me that the objective of all
facets of the industry are similar. All of us- distributors ,
operators, and manufacturers- are trying to maximize
our income . And , in so doing, it's only natural for the so-
called "hit games" to enjoy larger runs at the
manufacturing level. And , consequently, there will be
more of this type of game that will be sold as opposed to
those games which are not in this category.
So I would not agree that all distributors are becoming
mere order-takers , as a result.
True, there may be a tendency on the part of some
people to take the easy way out and take orders for the
top game and neglect their responsibilities to those
games that are not the very hottest. But I think it's only
natural for anyone in this business to try for the better
return on their investments; and the distributors, by
pushing the superior money-making games, are really
making the operator healthier and doing themselves and
the manufacturer some good . When we get those games
that are not hit games, it behooves all of us to try to limit
the production and sales and distribution of them since
they are not going to make the operator as good a return
on his investment. I think the solution is really more
comprehensive testing on the part of the manufacturers
to produce an even greater percentage of hit games
instead of producing those that are not hit games .
PLAY METER: Then is it a ualid concern to say the
operator could be unbalancing his route by ouerin-
uesting in a particular piece?
RODSTEIN: This was true years ago when changing
machines from location to location was prevalent. The
games would last in a location maybe a month or six
week ; then the players would be looking for a new game
in that location. But this has changed in recent years.
Games are lasting longer on location . Those games that
are in the so-called hit category are really amortizing
themselves in their very first location . So the operator
doesn 't really have to look so much toward switching
games in locations anymore . They stay longer. They
earn more money. I don 't think you'll fin_d many
operators who have injured themselves by buying too
many hit games. Nobody lost any money on Space
lnuaders and Asteroids. And I don't think they'll be losing
any money on Defender, even if they do buy more than
their normal numbers for their routes.
PLAY METER: At the recent Amusement Operators
Expo, it was brought up that many operators are afraid
they are ouerbuying on particular games but still are not
sure where they should draw the line. This seems
to indicate that the current Hit Syndrome has blurred the
lines of equipment budgeting, that there are a whole set of
rules out there. If this is so, shouldn't the distributor, for
his part, take a closer hand in helping the operator, to
make sure he doesn't ouerbuy, so that that operator will
be around as a c ustomer in years to come?
RODSTEIN : Those operators who are willing to accept
advice from their distributors in the area of equipment
budgeting surely have found out that two heads are
better than one . A distributor, having a broader view and
a lot of experience, should be able to help the operator
PLAY METER , September 1, 1961
with today's budgeting problems. But we should keep in
mind that budgeting for equipment purchases in the
games business is by no means an exact science.
Equipment budgeting can be more readily accomplished
in the vending equipment and music equipment
categories because it's not as difficult in these categories
to forecast the useful economic lives of those pieces of
equipment.
Let's assume that an operating company has budgeted
$100 ,000 for the purchase of new games in a fiscal year.
In the year when Space /nuaders was released or in the
year when Asteroids was released, it would probably
have been profitable for the company to have stretched
its budget to purchase those games in even greater
quantities than what they normally would have .
So, you see, the budget in games has to be flexible . It
can't be fixed . Let me cite you a specific example. An
operating company that is part of a large national firm
which operates vending, music , and games, recently
came upon an opportunity to acquire a chain of some 40-
odd convenience stores as locations . The manager of the
operating firm came to me and explained the situation. It
would require about $100,000 over and above his budget
capability, he explained, and he asked how could he
handle it. I told him he should go to his superior and
explain to him that this was unforseen opportunity and
the budget was for the replacement of equipment on
existing locations, and here was an opportunity to
acquire what amounts to another little route. He should
first try to get a special dispensation so that he could
increase his budget for the purchase of the games.
If they wouldn't do that, I told him, as his distributor,
knowing that he is extrememly credit-worthy, we would
consider leasing the equipment to him so that he could
acquire the additional locations without changing his
budget. So, to me, it's more a question of the feasibility of
the increased budgeting than it was in the budgeting per
se. Of course, this could apply in music or vending too.
But the point is the starting budget for an operator isn't
necessarily going to be the one that is going to hold up for
twelve months.
There will also be some years when the equipment
that's offered isn 't that great and so you won't see where
it's even feasible to expend your entire budget. It's more
a question of feasibility than it is one of budgeting. Or,
perhaps, I should say it's a combination of the two.
PLAY METER: Then are there times when, as a
distributor you counsel operators against buying
specific types of machines or against particular models?
RODSTEIN: Yes, there are such times . A distributor
must do everything in his power to help the operator
maintain a viable business .
Using the same example I started with, if a company
has budgeted $100,000 for the purchase of new games
but there is no exceptional game product available, it
may not be wise to invest the entire budgeted amount.
Now I've seen in national operating companies where
they have some pretty rigid budgeting restrictions ,
where they're almost like the federal government, and
the manager feels that if he doesn't use his entire budget,
even in a mediocre product year, he won't get a higher
budget the following year.
With games, it's such a strange animal. You can't do as
you would in the vending business where you can figure
this machine will be good for eight years and you've got
so much replacement to do and so on. It's pretty exact
science with vending and music because they don't have
the revolutionary products appearing as we have in the
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