Lorraine Williams - The Downfall of TSR

The Downfall of TSR

During the 1980s, TSR was the top games company in North America. However, in the early 1990s, TSR fell behind both Games Workshop and Wizards of the Coast in terms of sales volume. Seeing the profits being generated by Wizards of the Coast with their collectible card game Magic: The Gathering, TSR attempted to enter this market in 1996 in a novel way with Dragon Dice, a game that used packs of collectible dice instead of cards. In addition, despite a history of publishing only one or two hardcover novels each year, TSR also decided to publish twelve novels in 1996.

Sales of Dragon Dice through the games trade started strongly, so TSR quickly produced several expansion packs. In addition, TSR tried to aggressively market Dragon Dice in mass-market book stores through Random House. However, Dragon Dice did not catch on through the book trade, and sales of the expansion sets through traditional games stores sold poorly. In addition, the twelve hardcover novels did not sell as well as expected either. Despite total sales of $40 million, TSR ended 1996 with few cash reserves. When Random House returned an unexpectedly high percentage of the year's inventory of unsold novels and Dragon Dice for a fee of several million dollars, TSR found itself in a cash crunch.

With no cash available, TSR was unable to pay their printing and shipping bills, and the logistics company that handled TSR's pre-press, printing, warehousing and shipping refused to do any more work. Since the logistics company had the production plates for key products such as core D&D books, there was no means of printing or shipping core products in order to generate income or secure short-term financing.

With no viable financial plan for TSR's survival, Williams sold the company to Wizards of the Coast in 1997.