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GameStop Will Close Over 100 Stores This Year

GameStop Will Close Over 100 Stores This Year

GameStop CEO Paul Raines has announced that the gaming mega-retailer will be closing approximately 190 stores in 2017, amidst a decline in revenue from the fourth quarter of 2016.

There will be over 100 less of these out in the wild after this year.

There will be over 100 less of these out in the wild after this year.

The announcement came during a conference call with investors on Thursday, where the GameStop chief went over the company’s 13.6% decline in overall sales through the fourth quarter of 2016.

Raines cited weak overall sales of games in general during 2016’s final period, increased competition from other retailers in the gaming sector, as well as the disappointing performance from certain AAA titles.

Overall sales for GameStop fell by 8.1% throughout the entirety of 2016.

Aside from weaker than expected sales of 2016’s late-season heavy hitters, Raines also placed part of the blame on console manufacturer’s for failing to release updated hardware, which act as a catalyst to drive consumers into stores.

Although the major console manufactures have not shifted into a new generation of hardware since the start of the current generation in 2013, last year did see a number of upgrades and enhancements to current hardware, including:

  • The redesign of the PlayStation 4.
  • The redesigned Xbox One S, which included 4K support.
  • The launch of PlayStation 4 Pro – a more powerful version of the PlayStation 4, capable of 4K support and greater graphical fidelity.
  • The launch of PlayStion VR
  • The announcement of the release date for the Nintendo Switch, which allowed GameStop to begin taking pre-orders for the console, games, and accessories.

Microsoft also announced a more powerful version of the Xbox One during last year’s E3 event, however, they have still not announced a release date for the system, currently known as “Project Scorpio“.

Earlier this year GameStop was embroiled in a quasi-scandal involving their “Circle of Life” programs; the corporate mandated quota for employees to do everything they can to push used copies of games, over new copies, getting customers to reserve a game, or enticing them into joining their membership rewards program.

In a report in Feburary by Kotaku’s Jason Scherier, a number of GameStop employees described situations in which a new game would go on sale, and employees would feel the need to lie to consumers as to whether or not the title was still in stock as a way to force customers into purchasing the pre-owned copy, which would often still be retailing for a higher price than the new copy of the same game.

“We also tell customers we don’t have copies of new games in stock when they are on sale—for example, Watch Dogs 2 is currently $29.99 new and $54.99 pre-owned. We just tell them we don’t have the new one in stock and shuffle them out the door.”

While overall sales declined for GameStop in 2016, profit margins increased for the third straight year in a row to 35%.

Written by The Watchman

The Watchman


The Watchman is a journeyman gamer who has seen and played a good chunk of gaming history.
He’s also an actor, a reporter, a pro wrestling connoisseur, and some say he’s a cat whisperer.
If you have any questions or just want to drop me a line, hit me up at thewatchman@nerdbacon.com
Or follow me on Twitter @DavetheWatchman
You can also game with me!
Look me up on Xbox Live @ DJKhadoken
Or on PlayStation Network @ Eaglevision_dl

 
 

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One Comment

  1. When I saw the article headline, I assumed it was due to the increase in digital sales of games. Plus I feel like as systems get grander, the developers can make games that take longer to play through. So over a years span, gamers are buying less games than the olden days of the 90s .

     

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