GameStop has announced that it will be shutting down 2 to 3 percent of its retail stores globally this year. GameStop has around 7,500 retail stores across the globe and will pull the shutters on 150 of these shops.
Moving ahead, the video game retailer will focus its attention only on the successful ventures. The announcement from the company comes after a drop in sales in almost all segments in its fourth quarter report.
GameStop acknowledged a drop of 29.1 percent in its hardware sales and 19.3 percent in its software retail sales in the fourth quarter of January 28, 2017.
The cause of the decline was due to the absence of any big game launch during the recently-concluded holiday season.
What has caused GameStop sales to decline?
The Texas-based firm has been facing the threat from online retailers as consumers move towards online shopping.
The famous titles are available as downloadable content and can be purchased from online retailers like Amazon, which is handier as customers don’t need to visit a game store physically. Also, the Xbox and PlayStation have online stores from where consumers can directly purchase a particular game.
What are other rivals doing to combat online competition?
GameStop’s announcement comes after several other brick-and-mortar stores such as Macy’s, JC Penney, Staples and more closing their outlets. Also, some of these stores have adapted themselves to keep pace with online retailers.
Various stores have launched self-checkout kiosks and have translated the former store to a distribution site, where they get online orders. The buyers can get their orders from these locations with simplicity.
It is amazing to note that even after this fall, GameStop saw an increase in its collectibles sales. Collectibles indicate the video game-related merchandise. GameStop’s collectible sales witnessed an increase of 27.8 percent. This was led by sales of Pokémon-related toys and clothing.
In the fourth quarter, the company added 17 Collectibles stores, which hiked the count to 86 stores. This number is inclusive of 24 stores of ThinkGeek in the United States. The company plans to open 35 Collectibles stores, as well as 65 Technology Brand shops in 2017.
Whether these initiatives from GameStop will aid the retailer counter increasing sliding revenue is yet to be seen.