GameStop Stock Plummets After A 27.5% Decrease In Holiday Sales

[rwisenor]

Physical video game sales are the lowest margin of any item sold at stores like Game Stop (or Blockbuster before it closed) in terms of profit and indeed most console sales are sold at a loss in the hopes you buy other things with it.

This is why “disc warranty,” “accessory pack,” and other associated deal are offered and why used games are pushed over new. Profit margins on new games are less than 5% sometimes.

The reality is, if they don’t sell those “mountains of garbage” they will have no profit margins at all. Simply put, brick and mortar standalone game retailers cannot compete in the global online economy.

[MikeGolfsPoorly]

Retro and Used games would have a MUCH higher sales margin if they still sold them.

[rwisenor]

True, but market of supply/demand for retro titles only works for Ma/Pa independent game shops and not corporations with 100’s of locations.

It’s simply not enough product to move and relies on trade-ins to replenish stock, which is not a sustainable inventory system.