Palladium's Survival Strategies

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Kevin
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Palladium's Survival Strategies

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Palladium Survival Strategies

The plans for Palladium’s continued survival goes well, but the battle continues and will for the next 8-12 months.

The Opening Salvo

Phase One has been accomplished: The battle sounded, the troops rallied and the initial launch a remarkable success. That all began with the initial appeal for help in April. You, our fans and friends, came rushing to the rescue buying prints, backstock titles, specialty items, demanding to send donations, and an outpouring of support, kind words, encouragement and help that boggled the mind.

The amazing zeal and speed in which you responded help to avert disaster and enabled Palladium to press forward all Summer. We paid bills, rallied more troops, secured our position, released some key new books and a few reprints, and formulated long term strategies that should enable us to get back on our feet and survive in the long-term.

It was indeed a heroic and herculean effort. We could NOT have done it without you . . . but the battle for Palladium’s survival is far from over.

Phase Two: Implementation of Strategies

In some ways, Phase Two is more difficult than the initial rush to battle. People have already given so much of themselves and now they want a happy ending. I’m constantly asked, “Is Palladium saved?” and I want so badly to say, yes, but I can’t. We’re not saved yet, but we are getting there. Hey, it has only been four months and the damage to us was grievous. With your help, we’ve already made incredible progress, we have excellent strategies in place and a dedicated staff, friends and fans willing to do whatever it takes to survive this. And I believe we can! If I didn’t, I would have never made the appeal in the first place.

That’s why I’m writing this. We need you, all of you, for the long-haul. We need your continued support, encouragement and spreading the word to champion the cause.

The Plan

We’ve examined our strategies for the future from a million different angles and bounced them off investors, attorneys, advisors, friends, family and insiders. They are good, sound and will work over time.

1. Private investors (bless their souls) are on board. All are holding their breaths, crossing their fingers and offering their support. Not one has insisted on immediate payment (or else). All are willing to wait, many for as long as it takes. A few generous individuals have reduced their interest rate to practically zero, others have purchased prints, a few have offered to lend us a bit more, and ALL have offered their heartfelt wishes. It seems all of these good folk are confident Palladium can pull through too.

2. Build financial stability. Palladium has paid its most crushing bills and is working hard to pay all its debts, but at the same time we need to establish working capital and a reliable revenue stream.

3. Strategies for the future (not necessarily in this order):

a) New releases that strive to hit new benchmarks in story, quality and imagination. We have assembled the greatest batch of freelance writers and artists in Palladium’s history. We have more than a dozen powerful, dynamic and fun sourcebooks (and even a few RPGs) that we think will knock your socks off – plus dozens more in the planing stages. And that’s product for ALL our major lines. We just need the time and money to launch them
b) The Robotech® RPG license is going to be huge, I can feel it. I mean that. We love the property and did good things with it in the past and we’re going to do it again. Back in the 1980s, Ninja Turtles® and Robotech® put Palladium Books on the map, while Rifts® was the exclamation point that cemented our position. Bringing Robotech® back will be just as significant as it was in the past, and the product better than ever.
c) Bold new product like Warparth: Urban Jungle (coming), Rifts® Madhaven, Rifts® Sourcebook One, Triax 2, BTS-2 and sourcebooks for Palladium Fantasy, Heroes Unlimited, BTS-2, Nightbane, Chaos Earth, Phase World®, and many, many other projects we dare not yet reveal, will help to rebuild Palladium’s foundation, pay off remaining debt, and enable us to press forward.
d) Keep key back stock titles in print. We need to keep “evergreen” products in print (that's products that sell for years and years). A difficult task under the circumstance and we have key titles including the Rifts® Ultimate Edition, Juicer Uprising, Coalition War Campaign, Chaos Earth RPG, and others that are out of print or dropping to low reserves right now. We have to find a way to keep them in print.
e) Landmark projects also wait in the background. These are new titles, formats, venues and ideas that could be worth zillions all by themselves. Things that need more time and money than Palladium currently has to launch which is why the are part of a long-term strategy that is probably 1-3 years away, but which could be spectacular.
I’m not blowing sunshine up your . . . you know what. C and D, above are real. While Brandon Aten cannot reveal them, he is one of the few insiders who has heard several of these plans and ideas and was blown away by them. I mention Brandon for two reason: One, he can, without revealing what they are, confirm Palladium has more than a few potentially amazing ideas that could be huge. And two, because his reaction tells you how strong these ideas are. He was stunned to hear about them all when he interned with us. And I mean things that left him slack jawed and silent, barely able to eventually mutter something like, “Kev, I had no idea you guys had so much going on. This . . . this is amazing.” It is, we just need the time and money to launch them.
f) The mass market and new mediums. The promise of the Rifts Movie still hangs out there, at least for the moment. Erick Wujcik and others are floating ideas for videogames, computer games, film, TV, toys, other gaming mediums, etc., not just for Rifts, but for ALL our intellectual properties. If any one of these hits a big-time market, our problems should be over. If we crack into a few different markets in smaller venues and products, it could be the start of a snowball effect that grows and grows.
Don’t get too excited about the mass market. It’s a tough nut to crack and even interest by the Big Boys, like Nokia, Disney and Bruckheimer is NO guarantee that the product will ever even make it to the marketplace (case in point, Rifts® Promise of Power which was stillborn, and the Rifts® Movie which seems stalled and may never happen). Such exciting possibilities have to be pursued, but often require a lot of our time behind the scenes. If history has taught me anything, we can’t count on any mass market license, but if one should hit . . . it could be big, so we continue to spend time and energy on them.
g) Expanded online presence, podcasts (live and recorded), special offers, interviews, select and limited PDF files of books, and a host of other things are all in the works, and more. We hope to launch an expanded and fun online experience starting next year. We’ve had people working on this for a year now, but like so many projects, it is taking longer than we had hoped. The end result, however is something we think you’ll love.
h) Advertising. Must find a way to spread the word and get our products out to a wider audience.
i) Keep it simple. We don’t need to hit the lotto or cut a multimillion dollar deal for Palladium to survive and prosper. We need to stay focused on the basics and build. The basics are: Keep key titles in print, stay in touch with what the fans want, deliver strong new product, take calculated risks, and pursue promising new opportunities. That, by the way, is the formula for success. I know, because it has worked for 25 years.

The Challenges Ahead

So here are some of the challenges Palladium faces.

- Palladium’s working capital is dropping very low. The Robotech® license is going to cost us some bucks up-front and in advance (for licensing and attorney fees). That’s money to be spent now, on a book that won’t come out till February or March! A couple other projects also require money to be spent a few months in advance of any actual sales, reducing our working capital badly. No money to print new books would be bad.

- A ton of books need to be reprinted, but until we find the money to reprint them, some books could be out of print for a while. Please don’t be discouraged. See, the problem with “reprints” is we pay a lot now to print the books now, but it typically takes six months for us to sell enough to break even. It all works out in the long-run, but it is a drain on cash flow now while building for the future. And no, print on demand is not the way to go; poorer quality, much, much higher print costs, etc., it is not the solution for a company like Palladium Books.

- The printing of Rifts® and the Megaverse® – The Art of John Zeleznik, is also going to require some big bucks up front. However, it is a gorgeous book that we believe in, and that we know people will love as an art book, pictorial and a historical perspective of Rifts and Palladium Books over the last 15 years.

- On top of that, September is traditionally a slow month for sales. People are going back to school/college and trying to get in their last Summer vacation, convention or trip before having to hunker down for Fall and Winter. A slow month could stall the release of new product and this business is new product driven. We hope sales stay strong.

The New Year lull. Historically, February, March and April are way sloooow months for sales. We plan to have some exciting new releases, like the new Robotech RPG out to help mitigate the slump, but we’re nervous about it. Keep an eye out and please don’t forget about us in the doldrums of Winter.

Remaining Debt load. Though Palladium has made huge strides thanks to your support these past four months, we still have debt that we are slowing paying off as we can. We are making headway, but this is something that still haunts us and chips away at our cash flow.

Perception by too many that role-playing is dead. It ain't true, but that's an increasing perception among some segments, including retailers. This is another reason for the Megaversal Ambassadors to hit conventions and stores, for us to host the Palladium Open House (3 days of just role-playing) and for you to promote the hobby on a grassroots level (talking about RPGs, playing regularly, posting about books you enjoy, positive gaming experiences, upcoming game conventions, etc.)

How you can help

Okay, Palladium’s strategy for the future is sound and the promise of a bright future is there, the trick is getting to that point within the next year. You can count on us at Palladium holding up our end implementing our plan to the best of our ability, but we need YOU to help us keep going just the way you have been.

- Keep spreading the word about Palladium’s plight and how people can help.

- Keep encouraging folks to purchase the A Megaverse United print. Approximately 1812 sold to date – which is fantastic – but if we could sell another 1000 . . .

- Take advantage of the opportunities, contests and deals that will be coming up in the weeks to come. That includes our annual Christmas Grab Bag and a chance to get “your’ name (or the name of your character) turned into a significant character (hero or villain) in upcoming Palladium sourcebooks. Seriously. Spread the word about this too.

- Help by purchasing books you’ve been meaning to buy, as well as snap up those new releases you want. Spread the word about them too. If you think a particular new release is especially good or fun, tell other gamers about, talk about it online, etc.

For example, I’m hoping we can sell 100 copies of the incredible Masterwork Edition of the Art of John Zeleznik (half the proceeds goes to the artist since he is donating original art for each Masterwork) and 100+ of the regular edition of the art book by the end of October. That way we should have enough to cover the balance of the printing cost, and ease our cash flow. Btw, this book will make great Christmas gifts to budding artists, fans of Mr. Zeleznik, and fans of Palladium Books/Rifts.

In fact, we could use that kind of response with all our new releases. We need to keep sales (online and otherwise) strong. When you have the money, please, pick up one of those sourcebooks you’ve been meaning to try. Keep encouraging people to buy the A Megaverse United print and take advantage of other opportunities that will be coming soon. With Christmas coming, think Palladium as a place to buy presents for friends and loved ones.

- The Christmas season (starting in October) is usually great for our sales, and Palladium’s annual Christmas Grab Bags (also starting in October) is always popular. We’re a little nervous this year, because a lot of people are having a tough time – high gas prices and a slow economy and all – but then, those are all reasons we do the Palladium Christmas Grab Bagsand hope people take advantage of it as gifts for friends and as a treat for themselves. The Grab Bags are a ton of work, signing, gathering and packing all those books, but we are delighted to do it. It's our way of saying thank you and bringing a little Christmas cheer into our fans' lives. And we have more to be thankful for and happy about this year than ever before.

- Play, enjoy and talk about role-playing games. Run a campaign, run a one-shot evening of fun, encourage others to try RPGs. Don't take any of the things (or people) you love for granted.

- Come to conventions/gaming events where me and/or the Megaversal Ambassadors are running game events based on Palladium’s RPGs. Think about coming to the 2007 Palladium Open House 2.

- Keep enjoying role-playing games and Palladium’s products.

Wow, this got pretty long. Sorry about that, I just thought it was important to share what’s going on, where we think we are going, and how we’re getting there. I may post this Murmur from the Megaverse elsewhere too, to get the word out. Please feel free to pass it along to your friends and other Palladium supporters.

On last thing, thank you for all the incredible support you’ve already shown Palladium. It has been incredible and inspiring. It is welcomed and greatly appreciated. I just hope you’ll find our upcoming RPG products better than ever and worthy of your expectations.

Keep the faith and those imaginations burning bright.

Sincerely,
Kevin Siembieda
Publisher, Writer, Artist and Head of Palladium Strategic Command
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