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Wal-Mart Deal Further Promotes Cedar Falls, Iowa, Video Game Company

Posted on: Sunday, 30 October 2005, 15:00 CST

By Pat Kinney, Waterloo-Cedar Falls Courier, Iowa

Oct. 30--WATERLOO -- The assembly line was in full swing. The workers were hard at it. Product was rolling off the line by the dozens, put into cartons and ready for shipment.

One of the workers, Adam Pint of Waterloo, likes his job, among other work he does.

"It helps the community and you get an opportunity to help out other people," Pint said. "It's a job and it pays the bills."

Pint's workplace is Northstar Community Services, formerly known as Adults Inc. The product is video games designed and manufactured by a Cedar Falls company, Phantom EFX. And business has picked up in a big way both for Phantom and Northstar.

Phantom has reached a marketing arrangement with Wal-Mart to carry and sell a couple of its casino-oriented video games. It represents about 20 percent of the company business. The games, Nickels 'n' More and Reel Deal Vegas, will be carried in more than 3,100 Wal-Mart stores nationwide, including locally. Phantom figures to sell 35,000 to 40,000 of the games in Wal-Mart between now and Jan. 1, the busy holiday shopping season.

To move that much product, Phantom needs substantial help packaging the games for shipment. Phantom has turned to Northstar. Its client-workers with disabilities have been performing that work for 7-year-old Phantom EFX for several years now.

It was founded in 1998 by Darin Beck, Aaron Schurman, Marty VanZee and Danny Stokes. Schurman and Stokes approached Beck and VanZee, who also operate Genesis Digital Studios, formerly Image Brokers, about producing a video game.Phantom's games have appeared in major electronics and office supply stores such as Best Buy, Circuit City, Office Max and Amazon.com., as well as military bases

However, Phantom's marketing agreement with Wal-Mart is its first with a major general merchandise retailer.

"It's been a real pleasant surprise at the new people seeing our games.

Because we've had really, really good distribution but we weren't (previously) able to get the big mass merchant," said Jim Thompson, president of Phantom EFX. Phantom recently has reached a similar agreement with Target Corp. for another product, Reel Deal Slots Bonus Mania.

The Wal-Mart arrangement is so large that it guarantees Northstar a high volume of steady work for it client-workers for the foreseeable future, as Northstar tries to builds up inventory for the holiday season and beyond.

Although Northstar has had a similar relationship with other clients for years, the one with Phantom is now one of the biggest and most reliable sources of work the agency has enjoyed for its client-workers. The product has given a lift to Northstar's already-energized work force.

"That's wonderful. It's awesome ... the camaraderie and the work atmosphere," said Mary Anderson director of employee services at Northstar. Roughly 30 people are employed in the operation, grouped into three production lines. It provides good practice for workers' small-motor skills. "Sometime I have a hard time even," Anderson said, when she pitches in when a big order comes in.

They pick up speed with repetition, without losing efficiency.

"One of the nice things is the quality," said Thompson. "It's not even an issue with us. Our rate of return is lower than the industry average."

In the industry, a packaging error and recall can be very expensive.

"We're spoiled that way," Thompson said. "We just haven't had any problems like that. It's so spotty that it's almost nonexistent. They literally assemble from the ground up."

"The biggest thing is getting enough inventory in these stores," Thompson said. "If you have the inventory in there, if the product's decent, it sells. The more product you have, you have that 'wow!' factor -- 'That must be selling well, with all the games they have.' "

"When they call we jump," Anderson said. "That comes first and we can handle it."

Some of the Northstar workers like playing the games, and they can see the fruits of their labor any time they go to a store that carries the Phantom products.

"I go, 'I made those!' It's quite interesting, to see how they actually use them. I found them at Wal-Mart and Target," said Jennifer Hathaway of Waterloo.

Phantom EFX itself employs about 20 people and figures to add another three positions as a result of the marketing arrangements with Wal-Mart, Thompson said. Color FX of Waverly provides packaging for the products.

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To see more of the Waterloo-Cedar Falls Courier, or to subscribe to the newspaper, go to http://www.wcfcourier.com.

Copyright (c) 2005, Waterloo-Cedar Falls Courier, Iowa

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Source: Waterloo Courier

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