GAME woes

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Achtung Englander
 
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Re: GAME woes

Postby Achtung Englander » Sat Mar 24, 2012 1:17 pm

exactly. You can blame external factors as much as you like but at the end of the day GAME spent more than their earned and physical games today still make up more than 50% of the total games revenue which equates to billions of pounds. They had too many shops, drove away customers with their aggressive pre-owned model and did nothing on the digital side
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Re: GAME woes

Postby Nethlyn » Sat Mar 24, 2012 5:59 pm

Apple's rise suits HMV just fine, it's helping keep them afloat by being a mid-level reseller.

Post mortems won't matter if they can get the takeover done quickly in this 10 day period, We know the old management was shite, it's a bigger question about what the new lot will need to do to avoid the same thing years down the line or whether in the end, some of the stores will turn into returns centres for online hardware purchases.

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Re: GAME woes

Postby Achtung Englander » Mon Mar 26, 2012 2:27 pm

List of shut shops

http://www.mcvuk.com/news/read/store-cl ... ion/093365

The comments from MCV and Eurogamer all indicate a lot of hacked off GAME employees - more pissed by the fact that they got more news from the web than their own management team. Talk about every man for himself on this shipwreck
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Re: GAME woes

Postby Snowy » Mon Mar 26, 2012 3:05 pm

Woeful management in managing woefully shocker!

The previous MVC article was interesting - I think that Apple may well have upset their eponymous cart on the games front. I remember the iPad launch and thinking that there was a pretty gadget with no niche to fill - shows how much I know! My wife has one and it is like an additional limb, she is never without the thing! All that gaming spend, and none of it on the High St.

Between the smartphone and the tablet, I reckon a lot of the casual gaming market is getting their fix with Appstore/Marketplace buys.

Anyway, kinda a moot point now. I just hope a buyer gets found so the existing management can be booted out.
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Rossell
 
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Re: GAME woes

Postby Rossell » Mon Mar 26, 2012 4:40 pm

The Gloucester store has gone. There were some knowledgeable people in that one as well.
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Re: GAME woes

Postby Srcr. Maligree » Mon Mar 26, 2012 5:41 pm

That list could be updated further, but according to that they're closing both Halifax stores (1 Game & 1 Gamestation), yet leaving all of Bradford's intact (2 Games & 1 Gamestation) :-|

EDIT: Updated a final time, and Bradford's not left unscathed. Look again. They're not separated by Game/Station this time, but in alphabetical order.
http://www.mcvuk.com/news/read/store-closures-begin-at-game-and-gamestation/093365
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Re: GAME woes

Postby Animalmother » Mon Mar 26, 2012 6:31 pm

Wow, all bar one of the shops in Dublin are gone :(

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Re: GAME woes

Postby Medicine Man » Mon Mar 26, 2012 7:09 pm

ShopTo first to hump that corpse...

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Re: GAME woes

Postby Marty Fuffkin » Tue Mar 27, 2012 7:41 am

The Gamestation with daft prices I mentioned earlier in the thread has shut.

*shrug*

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Re: GAME woes

Postby Achtung Englander » Tue Mar 27, 2012 8:40 am

PWC tell it straight

http://www.eurogamer.net/articles/2012- ... -collapsed

"GAME Group had two fundamental problems," PwC valuation manager Mike Jones told Sky News. "First of all there was a very ambitious overseas expansion into seven territories in addition to the UK. On top of that the UK store portfolio is very extensive. Before we made the closures GAME had 610 stores in the UK. That footprint and that high fixed cost is very difficult to maintain."

GAME's overseas expansion saw it open stores in Scandinavia, Spain, Portugal and Australia, among other territories. Potential buyers are said to be interested in the Iberian business, which is thought to be performing well. The Australian business, which operates independently, is reportedly proving a sticking point with some interested parties.

And then there's the issue of the "unfortunate" close proximity of Game and Gamestation stores, which has in some UK cities and towns seen multiple shops within walking distance of each other.

"The store portfolio this morning consisted of 610 stores," Jones continued. "Part of the reason why GAME has been loss making is because of the high fixed cost in the UK. The restructuring that has been undertaken - and we do of course regret the 2104 job losses - provides GAME has a far more viable fixed cost, and with that it's in a much better position for a purchaser to take on with a view to making substantial profits from a smaller cost base. That's really what we're trying to achieve here."

He added: "Unfortunately, there was a lot of proximity between GAME and Gamestation stores, so one store was cannibalising the sales at the other store. So, through the process of rationalisation, we believe we can both reduce the cost but also ensure the sales that would have been obtained and recorded in one of the closed stores will migrate successfully to one of the existing open stores. So that cannibalisation will not take place and people will actually still shop and the levels of turnover will be maintained on a smaller footprint."

Many gamers will point to GAME and Gamestation's game prices as one of its biggest issues, with competition from rival online retailers, such as Amazon and Play, taking its toll. But Jones played down the impact of online, instead highlighting the importance of bricks and mortar to publisher's relationship with their customers.

"There is a migration to online," he admitted. "Having said that, there's a role for a niche retailer on the high street like GAME. And of course GAME itself, like many physical retailers, also has an online offering. So, while that's part of an evolution, it wasn't necessarily something that GAME wasn't reacting to."


"Retail has to change with the times," he said. "It has to face up to the very real challenge of the multi-channel approach, having to deal with the online offering. Stores have to be more than just a place where you can go and buy the product. There needs to be more of a wholesale experience within retail, from the customer's perspective. They need to be able to know exactly what's in the store at that time. They may just use it as a showroom and then buy the product online and have it delivered to somewhere more convenient."

UK shoppers, according to Manning, find themselves with less money than they had in the boom years, when readily available credit fuelled spending sprees. Now, as consumers focus on repaying debt, shops such as GAME are left out in the cold.

"The average consumer family is somewhere between £70 and £150 a month worse off," he said. "That's discretionary spend. That's what's going to be hit. People need to eat. They probably need to heat their houses and have transport. So it's either eating out, entertainment or buying discretionary items, such as clothing, games and other such things, that will suffer.
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Re: GAME woes

Postby Marty Fuffkin » Tue Mar 27, 2012 9:15 am

Hmm...none of that explains this...

Edam wrote:It was in profit at 37 million and had to file for administration? Why?! How much debt did it have to deal with and why?

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Re: GAME woes

Postby Me » Tue Mar 27, 2012 10:14 am

Achtung Englander wrote:"First of all there was a very ambitious overseas expansion into seven territories in addition to the UK.

[i]GAME's overseas expansion saw it open stores in Scandinavia, Spain, Portugal and Australia, among other territories. Potential buyers are said to be interested in the Iberian business, which is thought to be performing well. The Australian business, which operates independently, is reportedly proving a sticking point with some interested parties.


I'd guess that's why, Marty.

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Achtung Englander
 
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Re: GAME woes

Postby Achtung Englander » Tue Mar 27, 2012 10:16 am

i recall reading it was £188M in debt. The profit means nothing if your debt is so large it swallows it up and you cannot meet your existing obligations....like rent.

Hence bankruptcy.
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Lee
 
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Re: GAME woes

Postby Lee » Tue Mar 27, 2012 10:27 am

I really detest how business can run like this and claim to make a profit each year but are so far up there arses in debt there on the 150th return flight.
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Re: GAME woes

Postby Achtung Englander » Tue Mar 27, 2012 10:37 am

yes - after the Enron scandal new accounting rules were introduced to prevent this but accountants get paid a lot of money to find loopholes in these laws

case in point - Zynga (our friendly social network gaming publisher) recognises revenue from virtual sales (like virtual petrol for your virtual tractor) at any time over a period of ten years - so they keep their earned revenue aside for a rainy day when revenue actually falls to show a perpetual increase in revenue when in reality they earned it years ago.

And you wonder why people don't trust large cooperations
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