GameStop to Close Hundreds of Retail Stores in Coming Months
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Could this be the end of video game stores?
GameStop, the world’s largest video game retailer, is beginning to close some of its over 5,700 retail locations in what it’s referring to as a “first wave” of closures. As mentioned in a recent conference call, the company is expecting to close a “much larger” group of stores in the next year or two.
While the first round of closures will happen quickly, the second wave of closures will occur after a more in-depth consideration of each store’s individual region and performance. GameStop CFO, Jim Bell, had this to say:
“We are on track to close between 180 and 200 under-performing stores globally by the end of this fiscal year. We are applying a more definitive, analytic approach, including profit levels and sales transferability, that we expect will yield a much larger tranche of closures over the coming 12 to 24 months.”
While it’s too soon to tell how many stores will ultimately be closed, it’s clear that GameStop can no longer sustain such a large number of retail locations at a time when more consumers are purchasing games in digital formats.
The planned store closures are GameStop’s latest attempt to resuscitate itself. The retailer has already endured two waves of layoffs under a cost-saving initiative known as “GameStop Reboot.” This effort has also included steps to reduce the cost of salaries, taxes, advertising, and other non-production expenses.
While select retail stores may be closing, the company’s website just got a makeover, providing customers with a digital shopping experience that is easier and faster to use.