The Fall Of GAME...?

So this week marks the first 7 days of trading for the purchase of the GAME franchise. Finally this has started to affect the UK public and with it raised the profile of the failing business model. It’s been easy to ignore the financial reports and credit warning that have hit the Internet over the last few months with many people thinking that the management of the company would counter their decrease in profits.

Unfortunately this has not been the case as the UK’s largest specialist Video Game chain  has slowly lose their release schedule and with them possibly their brand. Recently they were unable to stock Ubisoft's PlayStation Vita games, Wii role-playing game The Last Story, Tekken 3DS and even Mass Effect 3 when it was released last Friday.

In September 2011 GAME consisted of 1287 shops with just under half of them in the UK alone. They were taking £1.625 billion in revenue during their last full trading year. The bank has previously issued them with a bill to pay for games up front and their credit built house suddenly started to topple over.

So as it is now even more apparent GAME are not out of the water and have put themselves up for sale. The bank could come to the rescue but this now seems doubtful and if companies like GAME can’t make ends meet then their bailiffs will.

What the biggest issue here is what effect this will have and how other companies like HMV will also suffer?

The first point to consider is where the 2.5 million people that walk into GAME and Gamestation are now going to need to find new outlet store. The likely answer is supermarkets, who even before this issue, had become much more competitive in the entertainment industry.  They are probably sharks smelling the blood in the water and have no doubt spotted the troubles GAME and HMV find themselves in. If they decide to be ruthless then they may share the UK market between themselves and their online competitors like Play.com and Amazon.

There are several issues with the supermarkets taking the market though as they are known for reducing their stock once their competitors have been left in their dust. One example being thrown around is that they did the same thing with books a few years ago. Supermarkets basically grabbed the biggest sellers and sold them so cheaply that their competition could not compete. It was a common place to see bookstores all over city high streets but now only Waterstones really remains. Once the supermarkets had wiped out their competition by selling the latest Harry Potter for next to nothing they decided to reduce their stock levels. If you walk into your local supermarket now you probably get the weekly top 50 at best nothing more. Imagine if all you could pick off the shelf was the top 50 all format games - would you be happy?

Not only would they destroy the industry slowly but they also only really sell entertainment products in their larger outlets. These obliging stores wouldn’t offer the library that GAME do now; and would likely only be interested in selling the biggest titles like Call of Duty and FIFA.

Alternatively this might mean that independent companies and the like of CEX being able to pick up their old customers. It’s not so likely as the example above with the supermarkets being able to advertise more and lower their prices to intentionally ‘price out’ the alternatives. Look at the initial selling prices of Modern Warfare 3 when it went on sale last year – some supermarkets offered the game new for between £25-30.

Market researches have explained that they would expect the customers to get spread around the industry and probably revert to online offers too. Where GAME rely on Video Games to do business the supermarkets don’t. They can simply strike at the inventory and then replace them with something else. The supermarkets try to sell as much of a range as possible to make sure they have everything a customer would need.

One of the other issues facing us would be the prospect where we would be unable to talk about the game themselves in stores. I like picking up recommendations myself, it's a great way to hear an honest opinion. People walk past windows and see advertisements, browse a wide selection on offer and can also usually find pre-owned discounted items too. It'll be more than a shame to see these area of the industry suffer.


People that work in specialised video game outlets tend to be gamers themselves and are very useful for casual players. It helps to keep the masses buying every week and it's encouragement that they need to pick up the next big title. 

Not to mention the fact that if GAME did got down then a lot of people will lose jobs and income. They really are a massive brand that will impact a bigger stage should they close completely. Granted a lot of this is speculations are real possibilities. 


Specialised stores like GAME also offer the greatest amount of midnight launches in the UK and drive people into purchases with goodies on offer and this would certainly hurt developers too. There is a real hype to these events in large stores like Oxford Street that turn in staggering numbers on AAA release nights. 

One of the simple fortunes has been that GAME have a booming pre-owned/trade in scheme that creates a lot of revenue from double sales tactics. Unfortunately or not this option has antagonised publishers around the globe as they do not profit from the sales. 

This really could become a threat to the industry, if one big player falls and the rest don't pick up the consumer base then we could be in for more unfortunate circumstances.