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GAME/Gamestation in trouble?

Started by Subtle Mocking, February 29, 2012, 12:12:32 PM

Previous topic - Next topic

Big Jack McBastard

And they get re-re-sales and re-re-re-sales and so on. I've traded in nearly every pre-owned title I've picked up, so one game represents a bloody long chain of cash to these places.

Mass Effect 3 originally sold for 42 quid
Very early pre-owned trade would net you maybe £35 in-store
Which they could sell again for £40 pre-owned.
and buy again at £25 from that customer.
To sell at £37.
and buy at £21
To sell at £34
and buy at £19
To sell at £30
and so on until the disc is in the bargain bin range or physically worn out. Never mind titles like Modern Warfare which managed to still be something like £32 for a pre-owned copy when I picked it up an age after it came out.

Retailers must make a fucking mint on half decent titles with a high recycling rate, it's little wonder they push them over original sales.

Obel

On a semi related note (with regards to pre owned sales) I went into a Blockbusters in Woodford yesterday and bought Deus Ex Human Revolution preowned but almost new condition for £8.99!

How is it they can do this but Game insisted on ripping you off for preowned games.

Also how is Blockbusters still going? I didn't realise they were still around, but they seem to be doing not too terribly... considering.

Big Jack McBastard

Quote from: ObelOn a semi related note (with regards to pre owned sales) I went into a Blockbusters in Woodford yesterday and bought Deus Ex Human Revolution preowned but almost new condition for £8.99!

How is it they can do this but Game insisted on ripping you off for preowned games.

Blockbusters has a sense of reality and needs to shift stock, GAME had a sense of profiteering and three shops in every high street to put all their shit in.

Will that do?

Works for me.

"Oh hello Mr & Mrs Liquidator! Come round to check the value of the stock have you, well as you can see they're all ludicrously expensive titles, that should go some way to paying off our debts eh?"

Small Man Big Horse

I can't believe Blockbusters aren't ultimately doomed, unless they massively expand their gaming sections, and retail dvds / blu-rays. And then sell everything at reasonable prices. Plus it could become Hooters-esque, where all the staff have big boobs and wear very little clothing. If that's legal. Is it? I mean Hooters must get away with it somehow? If it is, I think I've saved the entire company. And all companies if you apply the same reasoning.

Utter Shit

The two Games in Brighton are still open despite being a two minute walk from one another :dunno:

Ignatius_S

Quote from: Big Jack McBastard on April 02, 2012, 01:32:37 AM
Blockbusters has a sense of reality and needs to shift stock, GAME had a sense of profiteering and three shops in every high street to put all their shit in...

If it hadn't sold Gamestation to Game, things might have been different for the latter and punters. 

Quote from: Utter Shit on April 02, 2012, 09:42:36 AM
The two Games in Brighton are still open despite being a two minute walk from one another :dunno:

Be interesting to see what happens as part of Game has been bought now. 


REVEEN!

Quote from: Big Jack McBastard on April 01, 2012, 03:04:37 PM
Very early pre-owned trade would net you maybe £35 in-store
Which they could sell again for £40 pre-owned.
Where are you trading in your games?
I took a copy of Skyrim into Game two days after it was released. At that time new copies were in stock at £43.99 and they had a couple of pre-owned copies at £39.99.
They offered me £16 for it.



Subtle Mocking

Good article, and at least they've admitted that Game expanded far too quickly. There was absolutely no need for the amount of stores they had before the closures.

One thing missed off that list though, was stop being so anti-competitive. We know that those other places to buy games exist, and in so many cases they're not only cheaper but more reputable to buy from. That shouldn't be the case at all.

Ignatius_S

Yup, thought it seemed a pretty sensible read!

Also meant to post this the other week - the report into the Game and Gamestation merger, which is worth a look.

Big Jack McBastard

Quote from: REVEEN! on April 02, 2012, 12:54:59 PM
Where are you trading in your games?
I took a copy of Skyrim into Game two days after it was released. At that time new copies were in stock at £43.99 and they had a couple of pre-owned copies at £39.99.
They offered me £16 for it.

Ouch! This was Gamestation they had no copies of ME3 in stock, they had a similar offer for SSX Tricky when it came out, my receipt guaranteed a £35 trade if it if done within something like 10 days.

I've never traded at GAME didn't know they did it until fairly recently.

REVEEN!

Quote from: Big Jack McBastard on April 02, 2012, 04:45:56 PM
Ouch!
Indeed. At the time I'd probably have taken £25 but I took it back home, forced myself to keep playing it and ended up finally getting into it. I'm still playing it.

Quote from: Ignatius_S on April 02, 2012, 02:50:42 PM
Guardian look at what the new owners could do.
Could being the important word there. It wouldn't surprise me if in a few months OpCapita announce that they tried to make a go of it but couldn't and then convert all the prime retail locations into a new 'cash for gold' chain (or something similar).

Quote from: todays TelegraphSuppliers, who were owed £40m, will get nothing from the deal, while Game's banks will have to take a 55pc writedown on almost £88m of loans.
Will the likes of EA be happy to keep supplying stock to Game after being shafted like that? Especially considering they seemed to believe that Game's pre-owned business model was already taking the food out of their childrens mouths.

Ignatius_S

Quote from: REVEEN! on April 03, 2012, 01:15:59 PM...Could being the important word there. It wouldn't surprise me if in a few months OpCapita announce that they tried to make a go of it but couldn't and then convert all the prime retail locations into a new 'cash for gold' chain (or something similar)....

Indeed it is, hence the use!

OnCapita specialises in turning around debt-ridden companies – no idea if they are going to be successful, but I can't see what you're suggesting will happen. Why spend that much money on buying a company when you're then going to start an entirely new company? Particularly when you're leasing the sites.

Quote from: REVEEN! on April 03, 2012, 01:15:59 PM...Will the likes of EA be happy to keep supplying stock to Game after being shafted like that? Especially considering they seemed to believe that Game's pre-owned business model was already taking the food out of their childrens mouths.

Last published accounts for Game Group showed that £295 million to suppliers, as of 31 January – I know that £40 million figure is being bandied about now, but that's the one was being quoted at the end of February.

Game had done a deal with suppliers back in January, which would allow it to keep on trading - IIRC all new bills would be settled within 60 days. EA then broke ranks (as I understand) and after that it was a matter of time Game going bust. I doubt EA decision was made because of the second-hand market. From what I read, even with the deal done back in January, it was by no means certain that Game had the lines of credit to guarantee payment for future supplies so suppliers were risking being owed even more money. EA and the other companies most likely wrote off the Game debt as bad - and continuing to supply it would have just been chucking more money away.

When Game Group went into administration it was quite clear that suppliers weren't going to get their money. By paying some money to the banks, the new owners will be aiming to get credit lines to pay for future stock – that's what the suppliers will be most concerned about.

It was reported that one reason suppliers were willing to do a deal with Game in January was because the games industry wants a high street presence – the idea that supermarkets would be the main bricks and mortar stores that sell games doesn't fill the industry with joy.

I expect it would be perfectly possible for EA to demand what it's owed if the new Game wants its product, which it will ultimately have to.

Ignatius_S

Quote from: The Region Legion on April 04, 2012, 01:53:12 AM
I expect it would be perfectly possible for EA to demand what it's owed if the new Game wants its product, which it will ultimately have to.

Agreements with suppliers will have to be made, but the money owed to suppliers was written off as part of the rescue deal.

mook

#225
i don't suppose the £40m GAME owed EA has been broken down anywhere? the £40m is probably just what they could have earned if GAME had sold all the titles at full price in shop or online. its just a meaningless figure, if somebody wanted that particular title then they'd have just bought it elsewhere, so EA got their sale regardless of GAME going tits up.

MojoJojo

Well, no, I assume GAME has sold £40millions worth of borrowed games, but gave the money to staff/landlords. Unless EA are being really, really misleading.

Ignatius_S

Quote from: mook on April 04, 2012, 10:12:01 AM
i don't suppose the £40m GAME owed EA has been broken down anywhere? the £40m is probably just what they could have earned if GAME had sold all the titles at full price in shop or online...

The £40 million figure was for all suppliers – not just EA. As MojoJojo says, it would be for stock that was sold but hadn't been paid for. It was reported that

Quote from: Ignatius_S on April 04, 2012, 10:04:38 AM
Agreements with suppliers will have to be made, but the money owed to suppliers was written off as part of the rescue deal.

Indeed, and so since the only reason Game even got fucked this go round is because all the suppliers refused to let them stock anything, then they can just do that again if they don't get the money they think they're owed.

Ignatius_S

Quote from: The Region Legion on April 04, 2012, 05:03:54 PM
Indeed, and so since the only reason Game even got fucked this go round is because all the suppliers refused to let them stock anything, then they can just do that again if they don't get the money they think they're owed.

No, the problem was that Game Group was operating at a huge loss – it couldn't afford the rent bill for the last quarter (£21 million) and owed £10 million to the taxman. Its business model was no longer working. As I mentioned above, even if the deal struck with suppliers had gone through there were serious doubts about how long Game Group would remain trading - unless a miracle happened, no new additional debt would be the best that suppliers could have expected.

With regards to about the money owed to suppliers, when a company goes into administration, creditors need to make a claim with the administrators. This, they would have done, and as unsecured creditors, they would be lucky to get a fraction of what they were owed. When the administrators sold part of Game Group to OpCapita, the debt to suppliers was not transferred to the new owners.

Suppliers may not wish to trade with the new company, fearing bad debt will be run up again, but they can't demand that the new owners pay the debts run up by the old company.  If no suppliers dealt with companies bought out of administration, an awful lot less companies would be bought of administration – asset stripping aside, there wouldn't be any point.

Ah yes, of course. The world of business. I'm so glad I understand so little of it, I'd probably be even more angry all the time.

Thursday

There's a game still operating where I live. Stock is a bit limited though.


Big Jack McBastard

Oh god, scrolling down that image quickly gives the effect they're jumping out at you.

It's worse when it's bigger, up and down fast on your mouse wheel:

Quote from: Thursday on April 06, 2012, 01:15:08 PM


*shudder*


Dark Sky

But I don't want to take that :(