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Amazon and Best Buy Enters Used Video Game Trading

updated Sept 29, 2016: GameStop’s stock price increased 24% since July 2009, Nasdaq is up 225%, S&P 500 is up 136%. I’m sure the stock performance of GameStop somewhat tracked the performance of retail gaming chains. Recent earnings calls list new and used game sales down a little less than 10%. Downloading games directly and RedBox certainly has weighed on its earnings and risk. The “I wouldn’t buy it” for the industry is still my opinion after 7 years.

Originally published July 9, 2009

Amazon.com introduced used game trading in March 2009, and now Best Buy is testing video game trade ins.  Competition isn’t always a bad thing, but in this instance Game Stop and Play N’ Trade’s sales are going to be heavily diluted. Below was Game Stop’s response in the Best Buy article:

GameStop spokesman Chris Olivera declined to comment specifically on Best Buy’s test, but he indicated GameStop’s more than 6,000 stores have advantages over self-service ventures.”Trading in used games and consoles is a highly-assisted activity,” Olivera said in an emailed statement. “We are very confident in our model that allows for our expert associates to help consumers trade in product, a fact not addressed with a self-serve process.””Likewise, GameStop has over 12 years of skin in the game and understands the highly-regulated business of pawn and resale laws that vary not only from state-to-state, but municipality to municipality,” he added.

Young kids have been self-trained to research and buy online for the best price. I wouldn’t bet on kids paying a premium for simple trade-in transaction. Sorry Play N’ Trade and Game Stop.  One angle these speciality stores could still exploit is providing its customers with in-store use of expensive assets, particularly renting by the hour very high-end immersion and 3-d gaming equipment.

About Ryan Knoll

Attorney and advisor with an interest in franchising. Feel free to email me comments and questions on the "Contact Us" page.
1 comments
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franchisebooks

Well, competition makes the entrepreneurs comprising the business sector more enthusiastic in promoting the best quality of their products or services. The challenge to surpass what other competitors have achieved makes the consumers enjoy the benefits brought about by competitions. As long as the competition is healthy, better products and services are expected to abound the market.