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UK game retailers angry at supermarket prices
Author: Joe MartinPublished: 5th October 2009
Independent game retailers in the UK are calling for a change in UK law to prevent huge supermarket sales.
Speaking to GI.biz, Don McCabe of UK store Chips said that although the sales would see reduced prices in the short terms the sales would eventually force some stores out of business and create less choice in the market.
"Once they've got the whole market they'll expand their profits, reduce the choice and screw the suppliers," said McCabe. "And the only thing that can be done is what other countries have, which is to "recognise the insidious march of the supermarkets model is detrimental to the consumer ultimately."
"It's decreased choice. You just have to look at the amount of suppliers that are screaming holy blue murder over Tesco whose businesses just get driven into the ground by the demands that some of the supermarkets make on them. At the end of the day, the only people who actually benefit from it are Tesco shareholders."
"This sort of price slaughtering has been going on for years and it will probably always happen," admitted Neil Muspratt, director of SimplyGames.
"The timing of this particular activity is especially unhelpful. Like it or not, software prices are on the increase and selling one of the biggest releases of the year at less than £25 GBP sends a message to consumers that any higher pricing must mean they are being ripped off."
"It is also a particularly negative way to start off the all-important Q4 period and reflects badly on the entire industry – but what do they care?" he added.
Muspratt said that the worst part of it was that, with supermarkets selling at below cost, he was now getting his own stock from them and sending teams to buy out the stock that the shops would then need to sell at a higher price.
Let us know your thoughts in the forums.
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As for small retailers complaining and wanting the law changed; **** you! I want the law channged too! Selling me a game that has already been opened for full price is outrageous. Discs all thrown together etc. How am I supposed to trust I'm not being given one of the second hand copies by accident?
Frankly, they are all as bad as each other.
however take dragon age for example i really want that so i have preordered it on amazon just for the fact i know i will get it on release day
Simple really.
I think crowded, mainly.
On a serious note, here in Hungary we still have a few of those old-school shops and they're really nice. We'll probably have butcher shops for quite some time still, as they're the main and sometimes only source for most of the traditional hungarian stuff, unless you want to go to a farm and butcher some pigs for yourself.
We still have these?! *confused*
what service does a game shop provide that a supermarket cant these days? other than pre owned games. its all game/game stop's around where i live and they killed off the small game shops, so why should we have pity on them now?
consumer is king
Plus, my experience of these mega low supermarket deals is that they are sold out in minutes (probably because they don't stock that much in the first place) so you end up paying more in the game retailers cos they actually have the titles in stock, albeit at a higher price.
Maybe I'm wrong but that's how I see it!
Steve
I guess it's different where you live, but all these shops still exist near where I live. There is certainly less of them now, but that just means those left are more apprciated. People still support their local stores, because they are always closer and friendlier than a supermarket, but they will still use the supermarket when they want to buy 'a lot of everything' There's room for both.
As for the pricing, supermarkets are well known for loss pricing. Best way to deal with it is to go buy the super low offer, and walk out the store with nothing else. They can;t stop you, and it;s defeated their aims.
To sell things cheap, make customers happy, so they come back again and again. Yeah they are well aboard the fail train on this one.
Yeeh... mmmm Tesco have started to look at pre-owned trade ins too...
But if I'm only buying their loss-leaders, and am consious of their aims then the only winner is my bank balance. Not to say I don't shop in Tesco, but I would just as readily go to ASDA or Sainsbury's for a 'big shop' Supermarket favoritsm gets you nowhere, they too big to care what you think.
/joke
Promotion finished on Sunday Night... unlucky!
I appreciate it's tough for the independent high-street retailer, but honestly I don't see how the consumer loses out, which is one of their main arguments.
Tesco are not buying it any cheaper than Play, Game, Gamestation or Amazon, or any other larger retailer that gets the maximum "bulk" discount.
BUT.....they sell it as a "loss leader".........it gets people into the store or onto the website. If you are cynical, you may see it also, as part of a 'master plan' to put local high street game shops out of business (!).......although to do that they would have to sell them all at that price.
Play.com use similar tactics...they always have an "Offer of the Week", selling a (still) full--priced game at £10 or so......so Tesco are not the only business to use these "loss-leader" tactics.
Its not dumping since the end result is usually that with the small company out of the way the prices can then be hiked and the consumer looses out, Tesco is never going to put the internet out of the business. All the little game shops round my way are long dead under Game and i can't feel sorry for one large company getting a piece of there own medicine.
My local indie game retailer was put out of business when Game and Gamestation opened shops next door within 2 months of each other....! He carried on for 12 months and then closed down.
BUT.....at least Game and Gamestation have a second-hand market which is handier than internet sites. They will probably stay in business !
Daft thing is...they don't do their homework. When Dirt 2 came out, Game and Gamestation were selling the XBox 360 version for £45.......these shops are physically opposite each other on a narrow high street. HMV however.....100 yards down on the left, were selling it at £39.99.
Who do you reckon got my cash ?............???? !!!!!!
A computer games store only sells computer stuff, and does not have anything sold in volume to compensate.
It kills the high street.
All you will have left is a Large Supermarket, and nothing else...
It's sad that small retailers have been squeezed in this way, but I guess that's capitalism. Either let the big dog eat the little dog, or introduce artificial constraints on monopolistic practices.
And if the consumer thinks that this is a good thing then fine all we'll have left is what the consumer wants. If the consumer is willing to pay more for a boutique single product shop such as a butcher then there will be some enterprising chap willing to set up a butcher.
The reason why games stores don't work is that there is no market/appetite for paying more for a boutique service for a product that by definition is exactly the same whether you buy it from Tesco or LocalGameShop. We are all killing the boutique game store every time we buy from LargeChain or InternetGames.com do we care? I don't.
Unfortunately, I too simply buy from the cheapest place. But, local shops do second-hand stuff...which will probably never happen in Tesco !
** n/b it is funny to ring Game up on a Sunday, like 'loads' of times, just to hear them read through the stoopid mantra on the phone......!
.......hehe...yes, I'm evil.....
now i'm not anti capitilist as the companies provide jobs to us all i just fear that at one point we will reach the point where big companies can influence what we spend all ur money on (if we are not there already)
The company who produces and distribute the game should put a price that could be the minimum and maximum, that way nobody will be prejudiced.
tesco and others are selling at a loss because the cheap product gets you in the store and the theory then is you'll buy other stuff while you're there.
all the supermarkets do it, they price down the stuff people really want and make up the difference on the stuff you pick up while you're there.
not just this industry actually - when i was young a small bus company set up in my city, good service and cheaper fares that the big boys - price battle commences, the big boys can afford to undercut the small guys, and eventually force them out of business. then the bus fares rocketed back up to above where they'd been so that the consumer could pay for the loss they'd made whilst snuffing out the competition. and they had their monopoly back
A few years ago First tried to muscle in on the local bus company here by offering unrealistic fares, a few people moved from the local firm but not enough the service was less regular and had a lower range of destinations, after a few months First gave up with the dumping strategy and put there fares back up.
Moral of the story its not always just about price some times you can be more expensive but then you have to have an Unique Selling Point that isn't price.
Respect = 0
Small retailers need to cater to the enthusiast market and give them some kinda perks for coming there rather than buying online. Better yet, go online themselves. Advertise a same day delivery service on the shop front or something. Open their shops at late hours on new game release days etc.
Well done Asda and Tesco for selling the games at a decent price.
Game do that. Atleast the Game in Leicester does, my mates have been in there at midnight collecting pre-orders.
I've never even heard of chips, shows how big a store they must be, :D.
I've not really found the supermarkets to be much cheaper than proper game shops. I rarely buy games from them, except for old titles that they have at ridiculously cheap prices. Any game I've bought has been more expensive at tescos than any of the online retailers.
I hope they die a slow death, they are just as bad as each other. All supermarkets fiddle the numbers, its how retail has always been.
I agree with the ADAPT OR DIE statement.
Stop ripping us off!!
You all want lower prices, they get it.
However, we had this happen in the U.S. with music and it ruined our music industry. Monopolys are bad, and this is what they are after.
Years ago the marketing wizards decided to let Walmart do massive price cuts to cd's. It didn't take long before the big music stores felt the pain and started dropping. The mom and pop music stores were hit even harder. As the major music stores died, Walmart became more and more powerful. Today Walmart and Itunes rules the music industry here. Walmart now dictates pricing to the music industry, as does Itunes. The music industry denies it, ad fights it, but they really do have a price lock as without these two retailers, they will be dead overnight.
So we get music cheap right? WRONG!
When you went into a music store you could walk up to an employee and say "I like ____, what can you recommend that is similar and can I have listen?" Or when you checked out, they would make recommendations "you should try ____." At Walmart, there is no employee,and worse, they aren't into music.
Not a big deal you think, I can just look online. WRONG.
Walmart ONLY carries pop music. Looking for a copy of a band that only hit top 100, you won't find it. Want a copy of a slightly rare album, they won't have it. Forget imports. Forget anything that could be considered breakthrough or up and coming. If it's not on Billboards radar, they won't touch it. If an album has too strong of language or becomes controversial, they won't carry it.
Gaming will be worse. As they chop down to only the top titles, the shelves will reduce further and further.
Tesco isn't ripping anyone off, neither is your local game store. They are just using a loss leader to get you all to buy from them, get you hooked and run the others out. Once they have control, you and the industry is at their mercy. If the company feels a game is controversial, they won't carry it. One "Hot Coffee" incident and you may never see another game from that manufacturer.
it is indeed good for consumers to be here right now. buying games at knocked off prices. but what will happen when companys and businesses like "game" and "that's entertainment" disappear?
will they hike their prices to what you would pay for games now. then that will be the end of consumer choice.
or will it be they keep their prices fixed low every time a new hot release is out.
in my opinion i like the way smaller businesses are taking a stand against the bigger companys. but whatever the outcome its never in the best interest of the consumers. its all about profit.
Couldn't agree more, as far as I am concerned supermarkets are simply selling the game at a value more in line with its actual worth.
How is that the "worst part" of anything? He can buy stock from Tesco at below cost, and thus use Tesco's buying power and 'loss leading' practices against them... it'll sort itself out!
Well said .... you over in the UK should listen up
Yup, classic case, once company B is gone then company A raise price to make a nice fat profit over the losses they took before
All in all, it's bad for the consumer in the long run
I find it most ironic how people talk about Tesco and Asda as they would talk about the weather as though there was nothing one could do about them, there are alternatives you'll just pay more and spend more time doing it, the very large supermarkets only exist becuase people like them and use them.
yes, i always buy my games in a game shop. i will not support supermarkets as they are not specialized for games and their staff sucks. if you know what you want that's fine but if you need a 'human' advice on something you're lost. i always shop in specialized shops and the only stuff i buy in a supermarket is food for freezer. all other food i buy i buy on a market or from smaller shops.
Thats the whole point he was making, you think they are marked up extreamly high when they are not.
Tescos will sell the product at a loss in order to get you through the doors and hope you buy other things. Its called a loss leader.
Tesco is not making any profit on the game, only profit on the other items you buy at the same time which you wouldnt have normally bought that day if you just went to game.
The only saver is the supermarket itself.
Good for you mate, stand up for you principles even when they cost you. I have none so i'll get stuff where its best value, some times that means paying a bit more but with computer stuff it usually means getting it where its cheapest.
If you look at the proportion of the average salary spent on food and drink over the last 30 years or so it has consistently declined this goes almost parallel with the growth of the supermarket. Consumers have more cash to spend on luxuries becuase they spend less on food thanks to the supermarket and its overly agressive buying power, quite frankly with the consumer spending more then every one is a winner in the end.
Food miles, what a complete smoke screen. Take into account the cost of driving round all the boutique stores plus the cost of transporting small volumes of goods smaller miles add on to that the energy in growing non native foods and food miles quite quickly show them selves to be non-sense.
Obesity Tesco's fault that people can't control them selves. Any other non sense you'd like to blame on others?
I have regularly seen a 2nd hand game priced for more than new and I once took in a copy of spiderman 2 on the xbox to trade in and they offered me £12 and yet they had it selling pre-owned for £33. That was the last time I ever tried to trade in a game.
Yeh make £5 mark up on a trade in but not £21.
Total rip off.
They will sell them as loss leaders most likely, so sell them at a loss because it gets people into the shop and buying other tesco goods.
the one thing that confuses me is the number of game shops in a very small area, in southampton we have 4 Game shops within 10 mins walk of each other, why? reducing the number of shops will reduce over heads and increase proffit for the company