When the doors do finally re-open for business and things start getting back to normal, what kind of normal are we looking at? Bacta has been courting the views of its Division 4 members on what the industry has experienced and how they view the road to recovery. Steph Norbury talks to five key people in the distribution line in BACTA Division 4.
This time last year, we had all enjoyed a successful EAG (and ICE) and the industry was most concerned about how the weather would hold out over Easter.
Little did we know, that following the February school half term, the first cases of COVID would be reported in Europe and our lives were about the change radically.
Ironically, for BANDAI NAMCO Amusements Europe, it was the games themselves that first encountered the issues that were about to become a full-blown lockdown.
“Following a successful EAG we had products travelling to final destinations only to find Covid-19 was an inescapable problem, which did inevitably halt sales,” says James Anderson, Sales and Commercial Director.
“We’re in a fortunate position that a number of our titles had proven to be very strong – Nerf, Super Bikes 3, RabbiDs and Ladders and the like – which allowed them to be sold to other less debilitated overseas markets to keep the wheels of BNAE turning.
It’s just been a case of juggling from region to region depending on the state of their markets and the local restrictions.”
The speed in which events unfurled mean that most suppliers of machines found ‘juggling’ to be the order of the day.
“Before the lockdown started in 2020 we had a full order book after a hugely successful show at EAG at ExCeL, with our finest product range in years,” says UDC’s Sales Director Jonathan Lauder.
“We were fully expecting 2020 to be a marquee year. In order to fulfil these orders in a timely fashion for Easter we had purchased a huge amount of stock and it was arriving in the UK ready to go out to eagerly awaiting customers, then disaster struck.
“No one could predict the length and impact of the coronavirus pandemic. Customers fell into two camps, those who had high hopes of the situation resolving quickly or at least expected to be able to operate with mitigations in place over the summer who wanted the equipment they had ordered as soon as possible and those who clamped down on any expenditure at all and cancelled or postponed orders.”
In addition to sales seeming to fall off a cliff, companies had to work out what to do about staffing levels. Sega Amusements International saw the writing on the wall and made early plans for homeworking.
“We actually trialled home working before lockdown came into force and tried different departments homeworking for a few days a week.
We could then understand how people work and whether the technology would hold up. So, we had some proof that we could do it with some adjustments,” says Justin Burke, Sales and Marketing Manager.
Of course, it wasn’t as simple as putting staff on furlough or home working, as we then proceeded to enter a pattern of lockdowns, reopenings and tiered restrictions.
Electrocoin stayed open throughout. “We have remained opened in order to continue providing a service where needed especially during the Tier lockdowns as some parts of the UK were kept open and others were not including those abroad.
However, we are not operating at full capacity as staff have been on reduced hours to reflect the circumstances,” says Managing Director John Stergides.
“Naturally there has been a steep decline in sales which came to a near halt during the first lockdown. Gradually it did pick up again before and during the summer and then came to an abrupt halt again during the second lockdown.
It is tough, since operators missed some of the peak seasons depending on where they are based and with further lockdowns, this has and will continue to have a negative effect until the leisure industry can open again. But we have managed with our limited resources to keep supporting our clients and staff.”
Suppliers of machines and equipment found various ways in which to support customers, while trying to ensure that they could at least make some sales during the uncertain times. As Sam Coleman Sales and Marketing Manager at JNC Sales explains.
“Naturally, the pandemic had a direct impact on our domestic and international sales, as customers faced the uncertainty of how restrictions would strain cashflow and their ability to invest in new equipment.
We introduced several new ideas to help make it easier for our customers to invest in equipment whilst reducing the financial risk, through special clearance offers and also extended payment plans with dedicated finance companies such as Claratus.
We are now hoping to see an upturn in sales, as the industry prepares for a busy summer intertwined with a determination to optimise takings whilst they can.”
There was also the issue of monies owed to suppliers as operators went into lockdown as Justin Burke explains,
“We had to have those conversations and everyone worked together to clear debts and stay in contact using phone, Zoom, FaceTime – whatever ways we could to stay in contact during that period. We were all in it together and just had to work through it.”
The period of coming out of the first lockdown in the UK and beyond saw a flurry of activity that had suppliers trying to make up for the sales that had been lost in the first quarter of 2020.
As Justin Burke recalls, “There was some uplift around that time and some sales to people getting ready to re-open. It was a flurry of activity but it wasn’t enough by any stretch of the imagination. However, it was very welcome and it was good business to have.
“Many in the industry have used the phrase ‘bread crumbs’, and trust me all suppliers were looking for and grateful of any crumbs of sales!”
“Once lockdown ended and the provision for ‘flexible furlough’ was established we brought staff back as necessary over the intervening period to cater to customer needs,” says Jonathan Lauder.
“We had demand for items such as tickets and spare parts, as well as sending out games sold late in the season, with a surprising number of orders for games such as our Prize Cube cranes, Wild West Shootout and Poke ‘n Drop games, as a result from word of mouth amongst operators”
The situation is of course exacerbated by the lack of actual contact with customers. Normally, the sales staff at the major distribution companies would be moving from one trade show to another, keeping in touch with their main accounts.
“Trade shows are an important part of marketing strategies for the industry and our calendars are usually hinged around these significant dates,” says James Anderson.
“There is no replacement for live experiences of our products because there’s only so much you can demonstrate through word, image and video.
But one thing that does sing loudly are income figures, and with some sites around the world open or opening intermittently, certain key titles have still had opportunity to prove themselves, namely King Kong of Skull Island™ which has really excelled on USA test locations.”
John Stergides agrees, “The cancellation of the trade shows has had a big effect as they are important platforms to showcase new and existing product lines but most importantly, it’s an opportunity to catch up and speak with operators to understand their product requirements and to learn what has been performing well in their locations.
The relation and personal touch has been lost in some way. Unfortunately, we also lost the Open Day in 2020, and thus funds that are usually raised for the Bacta Charitable Trust were non-existent. We are hoping 2021 Park Avenue Open day will be go ahead and be the restart of the industry.”
“The cancellation of EAG 2021 has also been a big blow, although we fully appreciate why it could not proceed at this time,” adds Jonathan Lauder.
“To help mitigate this UDC has created video presentations for our new games, viewable on our website, YouTube and shared on social media. For 2021 our plan is to welcome customers to our the new UDC showroom here at Park Avenue, in a Covid-safe environment, as a substitute for the UK shows this year.”
Unfortunately, and inevitably this has culminated in a loss of jobs. “We’re a tight-knit group at BNAE, team-orientated with a communal desire to go the extra mile for our company and customers,” says James Anderson.
“For that reason, when it comes to decisions of this type when we’re out of options, there is a genuine harrowing feeling in having to part with much loved team members. So yes, Covid-19 has regretfully resulted in some loss of headcount.”
UDC, Sega and Electrocoin also confirmed a small number of redundancies were necessary in 2020. Looking forward the next priority will be finding a way out of lockdown and a roadmap to reopening.
“While keeping in close contact with operators, our next hurdle is gaining clarity on when the sites can open so planning and ordering can recommence.
During the pockets of openings that we’ve had, there has been a positive response in income on the ground. We know there’s a fruitful future ahead of us when restrictions are officially off the table.
Until then, working with suppliers like Raw Thrills, Adrenaline Amusements and Triotech who maintain short lead times, we are here primed and ready for the much-anticipated news,” adds James.
“We accept that 2020 is in the past and we just need to focus on the future and be positive,” adds Sam Coleman.
If the current scenario with full lockdowns continues for months/years then naturally it will have a detrimental effect for everyone not just our business.
However, if the leisure industry can fully re-open for Easter or thereabouts and there is the expected increase in ‘staycations’, this will have a positive effect and will go a long way to helping the industry recover. We need to keep positive just as we have done with obstacles in the past and need to help each other overcome them.”
John White, CEO of bacta concludes, “There has been very little Government support for manufacturers and suppliers during this time and they are so important for our industry; providing the thrilling games that players enjoy and expect and the parts and components to keep them running.
I encourage those customer-facing bacta members, wherever possible to invest in product to sustain suppliers through the challenges that restarting the economy will bring.”
Products to watch out for when you re-open
As we are distributor and manufacturer, there are number of products in our existing and future lines we would be promoting.
As we tend to focus on a good limited selection of products within redemption, cashless system, prize vending, pinballs, gaming and video games, we would be promoting all our games along with the new ones for the above categories.