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GAME profits slump 28%, chief resigns

onken

Member
Shares in Game Group have sunk 14% after the games retailer announced a 28% fall in annual profits and said its chief executive was stepping down.

Lisa Morgan will be replaced by Chris Bell - the former boss of Ladbrokes - as interim chief executive, Game said, as it announced its full-year results. The firm's UK chief operating officer Terry Scicluna has also resigned. Pre-tax profits for last year were £84.2m, down from the £117.4m reported 12 months ago. Game blamed the wider fall in video game sales for its decline in profits.

It argued that it had delivered its second-best trading performance in its history, and had "outperformed the market". "Our results were delivered against the backdrop of a very difficult trading environment, which saw the global PC and video games market decline by over 20%," said chairman Peter Lewis.

Previously, Game has also cited the absence of major new console launches as a problem. However, revenues are expected to continue to fall this year despite expected new product launches from Microsoft, Sony and Nintendo. Game operates nearly 700 stores in the UK, with nearly 800 more across Europe and Australia. Last year, international sales rose by 1.7%, but sales in the UK and Irish Republic fell 20%.

http://news.bbc.co.uk/1/hi/business/8633953.stm

Can't say I'm surprised, they're pretty much the only people that still sell games for full RRP. I wonder what steps they'll take to address this.
 
Stumpokapow said:
The real problem, like the OP notes, is that supermarkets are fucking spanking them on price.

Even HMV does, from my experience.

I dont understand how I can go into Game and see a game that has already been traded back in cost more then a brand new copy. They are just idiots.
 
GAME is such a horrible place. I hardly use them anymore. Terrible prices, both new and preowned. Annoying clerks, half of which don't know anything about games and are just idiots. Ugh, fuck GAME.
 
Actually this is quite interesting:

However, revenues are expected to continue to fall this year despite expected new product launches from Microsoft, Sony and Nintendo.

Natal, Move and...?
 
Wonder_pets_ming-ming_duckling002.jpg


GAME is in trouble
This is serious
We have to save them
 
There are two GAME stores near me, and each one has a Gamestation a few hundred feet away from them selling new games for cheaper than GAME can and accepting trade-in's for cash instead of just credit - then you've got supermarkets like Tesco, ASDA & Sainsburys all doing special deals on the day of a games release that just blow the dedicated gaming stores out of the water. It's not hard to see why GAME is failing, personally I haven't stepped foot in one in years.
 
I haven't even bothered to order from them cuz they require me to call them to validate my credit card but they expect me to pay for international calling fees. Good thing I have a contact in the UK.
 
I used to love Game, back when I was in school, but back then they WERE the best place to get games, being one of the few dedicated chains. Other than their direct competition (Gamestation for example, not nearly as widespread) the only other places that really sold games were either overpriced indy shops (great for rare games or imports, but not 'general gaming') and big media chains (like HMV, who seem to ALWAYS charge full price, even on old games). When combined with their loyalty card system, this really did make them the best option most of the time (it helped that they made sure that their staff at least pretended that they knew the first thing about the subject matter too).

But times have changed. Sites like Play came along, giving discounts due to their lack of retail rent, and my extensive steam list proves that many people like me are willing to ditch physical copies for a bargain. Likewise, stores like CEX that sell second hand games provide me a way to get those games that I didn't have a huge interest in below the price that I would have to pay to get them new.
Seems to me that Game worked best when Game was leading the way in dedicated computer game retail and really getting the gamers through their doors. But now they're just one fish in a big sea of options and gamers know where else they can look.

Just look at the forthcoming release of Lost Planet 2. Game offers free DLC at release but otherwise loses out on price to both Play and ShopTo (which is also giving away free T-shirts).
Game probably still makes a lot on kids and parents looking for gifts, stuff like that. But I'd imagine that the gamers that helped them spread 10 years ago now know where to find better deals.
 
onken said:
Natal, Move and...?

Nintendo 3DS.

...and, yes, GAME is appalling - why on Earth should I pay so much more for a new game and the privilege of listening to badly-chosen, loud music and the opinion of the sales staff on whatever I buy ("oh, that's not suppose to be very good..." Really? Well, let me put it back on the shelf then...) when I can pick up new releases for significantly less in Tesco, or wait a week or two to pick them up for a fraction of their RRP in online sales?
 
Alot of supermarkets sell for little to no profit on games because it gets people in the store, especially if the game is big. Its not uncommon for a tesco/asda to lower prices in and around release to just beat the other and get the business in. I remember when Harry Potter was released last Tesco i believe sold it for rediculous prices just to get the business.
 
I last went in one about 5 months ago (first time in a few years), I was gobsmacked at the prices they were charging for new and used games. Like its previously been said, when you charge full price for games and sell used copies for more than competitors sell their new ones, the only way is down. It's not rocket science ffs. I'm amazed they have been in business as long as they have.
 
Kowak said:
Exactly, there is a Game and a Gamestation two minutes walk away from each other.
This. I have the exact same situation where I live and it's laughable that one company would choose to have two chains so close together.
 
Mr Cola said:
Alot of supermarkets sell for little to no profit on games because it gets people in the store, especially if the game is big. Its not uncommon for a tesco/asda to lower prices in and around release to just beat the other and get the business in. I remember when Harry Potter was released last Tesco i believe sold it for rediculous prices just to get the business.

Yeah the best example of that was MW2 last year which the UK supermarkets went to town the game could be picked up on launch day for under £29.99 the lowest i think was £26.99.

How can any game shop combat those kind of first week prices?
 
Like others have said, one of their major problems is their huge number of stores, many of which are redundant. If they closed their stores that are right next to each other ala GAME/Gamestation then I'm sure they'd have a healthier balance.

The other problem is clearly pricing, with strong competition from supermarkets. They have to lower their prices on pre-owned games (what, £5 off? You're kidding me!) and find a way to sell more bullshit to the hardcore crowd.
 
I think laying the blame purely at the door of the supermarkets is incorrect. Poor customer service, RRP (or more!) for games and peripherals, points cards etc p[lus the competition from online retailers all add up to a major headache.

They're closing at least 130 shops this year to try and redress the balance buit I think that in the long term they'll be in serious trouble unless they make some fundamental changes.
 
Dabanton said:
Yeah the best example of that was MW2 last year which the UK supermarkets went to town the game could be picked up on launch day for under £29.99 the lowest i think was £26.99.

How can any game shop combat those kind of first week prices?

That was just sick, I knew so many people at work who pre-ordered from Game and then when gutted when they heard how cheap it was going for, especially as Game were shit at sending them out as well.
 
J Tourettes said:
I think laying the blame purely at the door of the supermarkets is incorrect. Poor customer service, RRP (or more!) for games and peripherals, points cards etc p[lus the competition from online retailers all add up to a major headache.

They're closing at least 130 shops this year to try and redress the balance buit I think that in the long term they'll be in serious trouble unless they make some fundamental changes.

Its like GS here in the states. Same deal. Where I used to live I had 5 GS stores within a 3 mile radius (I am not embellishing either).
 
It's sad to see people unemployed and I like having lots of outlets to buy games from but these guys simply aren't competitive with their pricing. It was inevitably going to catch them up sooner or later.

Mad_Ban said:
This. I have the exact same situation where I live and it's laughable that one company would choose to have two chains so close together.
It's the same where I live. It's the illusion of choice, the same reason you'll often see Currys and Comet and Dixons Link and PC World in the same retail park, whichever you choose DSG (the parent company of all 4) will profit.
 
pilonv1 said:
Console prices drop, retail game revenue falls. Not exactly rocket science.
Very little money is made on a console sale. Game sales is where it's at.

When a console has a price drop, the stores get a rebate too. They basically make a small amount per console sale, regardless of how much the console currently costs.


As for Game costs, at least here in Australia they do often have decent sales. Also, they offer a fuckload more on a trade than EB. Not that that is a hard thing to do.
 
Nickiepoo said:
All their stores became 'Zavvi' recently, but I don't know if it was a buyout or a rebranding.

They rebranded nothing here :lol
Anyway I meant Fnac anyway but since it's not exactly known to some I usually say Virgin since they're known on the other side of the pond.
 
Kowak said:
Exactly, there is a Game and a Gamestation two minutes walk away from each other.

Same here except we also have a second Game store as well where Electronic Boutique used to be.
 
Nickiepoo said:
All their stores became 'Zavvi' recently, but I don't know if it was a buyout or a rebranding.
Zavvi?
What kind of shitty name is that?
Virgin Megastore sounds much more badass.
MEGASTORE.
 
Kowak said:
That was just sick, I knew so many people at work who pre-ordered from Game and then when gutted when they heard how cheap it was going for, especially as Game were shit at sending them out as well.

I went along to my local ASDA for 12 thinking no one will come to this store maybe 20 at the most only to be greeted with an absolutely massive line of people waiting for the game after three hours of drama and listening to gossip being spread along the line i.e the store don't have enough copies, not the sort of news you want to hear when you've been lining up for 2 hours . ...Three hours later i finally got my copy.

Then walked outside and still saw people still queuing up to get their copies. :lol
 
If anyone wants to visit the absolute worst game store, they should hit up the Irish GameStop stores. There are two in Belfast, and no God nor respectable man lay within those hallowed walls. The stores smell like piss, the stock is terrible, the prices are laughable and the clerks think they're cool as fuck and they believe they know everything. After the Wii came out, a friend of mine went in and asked if they had any Gamecube controllers, and the dude behind the counter started laughing, and then said they were last gen. Same thing happened a good while after when the same friend was looking for a copy of Resident Evil Zero. Fat fucking prick.
 
Unlucky. But when you have 10 stores within 10-15 mins of each other. You fucked up. :lol

Oh and £45 for Heavy Rain new? Get the fuck out.
 
GAME and GAMESTOP are the only game stores in Ireland, GAME actually looks good compared to GAMESTOP and HMV :/
So nearly all my game purchases have been online for the past few years, only time I ever buy from brick and mortar is places like CEX.
 
The problem I have always seen is that they have way too many stores, in Swindon there is like 3 just in the town centre! and that is not counting in the gamestation store down the road too, Reading has too many also. Also they live with making profits on used sales, something where ebay nets you a much better cash rate and other stores and websites now allow trades, so they need to think of something else.

Their greed has gotten to them.
 
I can't remember the last time I bought a game at GAME.

HMV almost invariably have better deals, they've gotten very aggressive on games offers.

GAME, for a long time, has operated on the assumption that people would come straight to them and not bother to check other places first. They used to - if they don't still - have a 'lowest price guaranteed' mantra, but all that meant was that if you found a game cheaper somewhere else they price matched it. But for quite some time people trusted that to mean that a game wouldn't be cheaper anywhere else, so they just defaulted to going to GAME.

But that's totally changed now. People are far more conscious of where the best price for a game is now.
 
Kurtofan said:
Zavvi?
What kind of shitty name is that?
Virgin Megastore sounds much more badass.
MEGASTORE.

Tell me about it mang!

Though, to clarify on my earlier post, I was talking about the UK.

OMG Aero said:
And then Zavvi went under so I think they are just a website now.

That would explain what happened to the one on Oxford Street. Ha, oh well.
 
Yeah, I remember when this guy came into my store with a load of PS2 games he wanted to trade in. I scanned them all, and said 'yeah, uh...you'd get 80p each for those'.

him: 'WTF, I spent £8 at least on each of them at GAME last week'

me: 'yeah, uh, they're £1.95 each here to buy, same for all preowned PS2 games'

him: *utter shock*
 
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