Having spent some considerable time circling the drain, high street gaming goliath GAME has finally succumbed to the financial waters and gone into administration, taking its CEO Ian Shepherd with it. Does this mark the beginning of the end, or can the retailer be saved?
The official GAME statement reads as follows: “The group has faced serious cashflow and profit issues over the recent past. It also has suffered from high fixed costs, an ambitious international roll-out and fluctuating working capital requirements.” The company was taken off the stock exchange last week, and has now bitten the bullet.
Sensing that his role is no longer needed in the same capacity, the company’s CEO, Ian Shepherd, has wasted no time in stepping down. “I’ve said a number of times that the administrator, once appointed, takes charge of the business,” Shepherd said in an internal memo. “Having two people try to do that is both confusing and a waste of money. With that in mind, I’ve agreed with Mike that I will step down as CEO and the business immediately – this is my final email to you all.”
So what does this mean for gaming? As we mentioned last week, GAME’s departure may cause the end of supermarket mega-deals, seeing as the rest of the market now has one less force to compete with. Although let’s not get ahead of ourselves: GAME is remaining defiant and hopeful.
“Despite these challenges, we believe that there is room for a specialist game retailer in the territories in which it operates,” says the company, “including its biggest one, the UK.” The statement ends by suggesting that a “sale of the business is achievable.”
Do you think anyone will jump in to save the struggling business? And, what with online deals and direct online delivery becoming more commonplace, is there actually any room for a high street gaming outlet any more? Let us know your thoughts below.
Update: MCV is reporting that scores of GAME and Gamestation stores across the UK are already closing their doors. No sign of super-cheap fire-sales, unfortunately.