Economic Fears Hit Retailer Stock Orders

[Dante]

The global economic slowdown is applying more pressure on videogames publishers as retailers in the US slash their stock orders.

 

In a bid to limit any risk of piling up unwanted inventory - if consumers stop buying games - all five key retail chains in the territory have started to cut their day one orders, causing growing concern among the publishing community.

That's according to Sega Europe president Mike Hayes, who told GamesIndustry.biz that although Europe isn't quite in the same position, it's another headache for the industry to have to deal with.

 

"Retailers, definitely in the United States, are being far more prudent in what they buy, so they're clearly going to focus on the triple A titles, but their day one orders are coming down," he said. "What they're saying is that they'll take in as little as need to, see how it sells through, and then they know they can order again in a matter of days if not hours. So that's hurting us.

 

"In the United States you've got five customers, and those customers are saying that they don't need to order four weeks' stock, I'm going to order two. I don't want all this inventory. I think you'll find most publishers in the United States will be having similar challenges, to be honest.

 

"But Europe is such a mosaic of opportunities - while all the retailers are being more aggressive, and we understand why, Europe's a much more fluid and flexible market to manage, so we're in a good position."

A fall in stock orders is the latest issue to hit the publisher-retailer relationship, following a greater take-up of second-hand game sales by retailers in North America and Europe as well as a push into game rentals, while publishers look more closely at direct sales via digital distribution.

 

www.gamesindustry.biz

[Shino]

I don't see what's preventing European retailers from doing the same.

[jammy2211]

Less competition, I'd guess.

 

I mean, aside from GAME and GameStation (Who are owned by the same company) there are no major game retailers. Sure there are alot of places which do video games but that's about it.

 

Not sure how it is in mainland Europe mind you.

[Tellyn]

Gamestop exists in Ireland and other European countries, but I believe GAME are pretty much unrivalled across Europe.

[sumo73]

In a recession people will go out less and spend a bit more time indoors to watch DVD's or play video games. Yes, the video game industry is getting hit but I don't think as much as say the building trade or other similar industries.

 

It's a shame that GAME (which owns Gamestation) is really the only major player in the UK. I can't speak about the rest of the Europe because I've only seen a few video game shops in France, Belgium and Poland before.

 

A recession will tend to stamp out weaker competition such as the independants who by and large have at least a better understanding of video games and share more of a passion for them. Well that's my experience anyway.

 

I still buy most of my games online where I believe I can get them cheaper than on the high street.

[Guest Jordan]

GAME rules the game market here... But their online prices are fantastic and their loyalty scheme gives so many points on a pre order. Why complain?

[GothicPlague]

GAME rules the game market here... But their online prices are fantastic and their loyalty scheme gives so many points on a pre order. Why complain?

 

Can I complain about the lack of retro stuff in Gamestations since Game bought them?

 

I miss going into gamestation and buying a classic like Conkers Bad Fur Day on impulse.