GameStop Closing 250 Unprofitable Stores, Opening 60 New Locations in 2013
New and used games retailer GameStop is planning to close 250 existing brick and mortar locations, according to comments made by company CFO Rob Lloyd at the Goldman Sachs Technology and Internet Conference in San Francisco, California. Oddly enough, while GameStop is declaring it 'game over' for 250 locations, it will also open between 60 and 70 new stores in 2013.
There's a logical explanation for why GameStop is both opening new and closing down existing retail stores.
"Closing 250 stores enables us to deal with the very small percentage of stores that we have that are unprofitable, but also to close marginally profitable stores and actually make more money by moving customers to other nearby stores," Lloyd explained. "We've been successful at that for two years, and we'll continue that program in 2013."
There's a logical explanation for why GameStop is both opening new and closing down existing retail stores.
"Closing 250 stores enables us to deal with the very small percentage of stores that we have that are unprofitable, but also to close marginally profitable stores and actually make more money by moving customers to other nearby stores," Lloyd explained. "We've been successful at that for two years, and we'll continue that program in 2013."
Lloyd also talked about the business of selling used games and how, in his opinion, publishers are starting to understand that it's not a bad thing for them. He claims that only 4 percent of used games sales are titles that have been released in the last 60 days "so it does not have a big impact on the sale of new product." He also said that by offering trades to customers, GameStop is able to sell more new games than it otherwise would have, because the company is putting money into its customers' pockets.
Speaking about the possibility of a new console not allowing gamers to play used titles, as has been rumored with the Xbox 720, Lloyd said he's seen research indicating that 60 percent of customers would simply not buy the new hardware.
Speaking about the possibility of a new console not allowing gamers to play used titles, as has been rumored with the Xbox 720, Lloyd said he's seen research indicating that 60 percent of customers would simply not buy the new hardware.
