Advice on Running a Successful Videogame Store?

xlilacx asks: "The video game industry is worth $25 billion, and predicted to rival the global music industry in the next 10 years. Even Grandma is joining in on the fun. My husband and I bought three video game retail stores two months ago, and so far sales are dismal (down 25% from last year's sales), which seems to be an industry trend. I've noticed a few things that are contibuting to our lack of profits: the people who weren't able to get an XBox 360 have decided they will wait to get one (which most likely will be after Christmas), and they will not buy any games for their old systems in the meantime; people are automatically conditioned to go to the EB-Games and GameStop stores at the malls, even if they give less in trade-ins and have horrible customer servicr; lastly, kids come in with piles of junk games (Madden 2001, etc..), and get enough store credit to buy the latest greatest game that we only mark up like 5%-10%. I'd like to ask Slashdot readers if these observations are a good reflection of the mentality of video-game buyers everywhere, and what suggestions they have for a small ma-and-pa video game store. With all the huge retailers in the video-game market and the EB/GameStop merger, is there a place left for the local game store?"

Comments

A few guidelines:

[Thedalek]

1) Are you a gamer? If not, hire some intelligent diehard gamers to help you get what gamers want. You'll probably know a few from your repeat customers.

2) Junk Games: There comes a saturation point where you simply cannot accept any more of a particular title. If you've got 10 copies on hand, don't accept any more, or reduce the trade credit value to something trivial. A sliding scale on trade credit value is more fair, but also more confusing to customers ("But just 5 minutes ago, you gave that guy $2.00 for this game!") and more trouble to keep updated.

3) Big system releases are always rough on the secondhand stores. If you can't get 360 systems, focus on what you can get. Offer specials and deals for the holidays. Offer packages of similar games (All Sonic the Hedgehog games for the Sega Genesis in one pack). Toss in a free game or two from a small selection with the purchase of other systems. Try to keep the discount in the 10-15% range.

4) Keep some items on hand for novelty sake. Understand that you won't necessarily sell them, but that they will function more as museum pieces to attract customers. NES Power Pads are cheap, and make interesting wall decorations. Power Gloves and ROBs can also be had reasonbly, and are similarly eye-catching.

5) If you don't already have any, set up some systems for customers to try games in store. Allow customers to request games ("Can I try this game?"). Only enforce any kind of time limit if there are other customers waiting to try games, or if the customer has been playing for an hour or more. Remember that sales counter duties take precedence over demo system duties (as in, finish ringing up customers before taking care of the kid wanting to switch games... again.)

6) Gather up all the merchandise you'd rather never see again, and are potentially willing to lose completely. Put it in a "$5.00 or less!" bin. Toss in a few higher quality "acceptable losses."

7) Watch flea markets, garage sales, even eBay for an affordable, functioning arcade cabinet. Alternatively, rent one from your local "amusement machines" dealer. Make sure it's something older, from the late 80s or early 90s. Put it on free play on the weekends.

Re:Time

[Yorrike]

"Provide an environment that provides the service, but do perks, make it a good place to hang out"

Exactly. As odd as this sounds, your focus shouldn't be selling games, it should be building a community and a regular, dedicated shopping-base. If you have the space, I suggest putting a couch in with a TV, or a couple of TVs, instead of the regular IDUs. It'll make your stores feel welcoming and people will want to stay.

My parents used to run a toyshop, and being the gamer I am, I set up a gaming section there. Problem is games have such a small mark up on them, that it wasn't worth the investment (except for crazes like Pokemon), so I have an insight into your woes.

My suggestion is to make your stores work like some book stores. Their major profits come from selling coffee, not from selling books, even though the people running the place are book geeks. If you understand gaming, use it as a strength to sell things to gamers, not just games and systems.

Think of this; put those couches in, people will stay and play games for a while. If people are in a place for a while, they get to know everyone else in that place (common interests and all), which will make them stay longer. If they stay longer, they'll get hungry and thirsty, so sell drinks and some food. As the community grows, so do your sales. If people like you, they think "I could buy this game from website X and wait a day or 2 for it to arrive, or I could spend a couple of hours playing it at that mum and dad's store, where I can talk to people I know and like, about the game. After that, I can come home and play the rest of it after I bought it". To put it in another context, it'd be like running an open member's arcade with lower overheads.

I'll tell you one thing, if a store like that existed near me, I'd buy my games and spend a good amount of time and money there.