SEPT. 28, 2010 • Retailer GAME, based in the U.K. plans on trimming its locations from 635 to 550 during the next three years. The firm is also seeking smaller five-year lease terms on its properties, compared to the seven-year terms it had preferred previously.
Impact: GAME is a dedicated brick and mortar retailer that competes directly with GameStop. In 2007, GAME acquired competing specialist retailer Gamestation. At the time there were concerns that GAME was acquiring a monopoly. Never mind the potential competition from traditional retailers like GameStop looking to enter the market, GAME’s biggest issue is the increasing movement to online distribution. GAME reported that first half 2010 sales were down 9.6%, less than the overall industry. However, it is also true that after the Gamestation acquisition there were simply too many stores, many of them very close to each other. So closing some down makes perfect sense. The biggest issue is with a declining sales price could GAME become an acquisition target for a company like GameStop.
