Not Stocking Mass Effect 3 Could Cost GAME Up To £2.5m In Profit

By Darryl Kaye on March 2, 2012, 5:29AM EDT
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It's believe that GAME Group's decision to not stock Mass Effect 3 could cost the company up to £2.5 million in lost profits, according to an analyst from Singer Capital Markets.

When speaking to The Guardian, Mark Photiades said "Working on the assumption that a decent triple-A title sells 0.8m-1m titles in the first few weeks of release in the UK and assuming GAME has around 20 per cent share, we calculate that by not stocking Mass Effect 3, GAME is potentially missing out on around £6m-£7m of revenues in the UK given the title will retail for £39.99."

Earlier in the week, GAME Group, which includes high street retailers GAME and Gamestation, confirmed they wouldn't be stocking Mass Effect 3 at all, even though they had an exclusive agreement to ship the Collector's Edition of the game. They also confirmed they wouldn't be stocking Nintendo's Mario Party 9.

"It is also worth noting that margins will suffer as a result of the reward card points being offered in compensation. We estimate this could amount to another £0.3m of forgone gross profit as typically pre-orders account for around 30 per cent of initial sales," continued Photiades. "So in total there could be £2m-£2.5m of lost UK profit in a year where we are already forecasting losses of £8m."

GAME's decision to not stock Mass Effect 3 will also affect all of EA's games scheduled for release in March, although they are confident an agreement can be reached for EA's games in the future. However, Photiades also stated that the decision to cancel pre-orders so close to the game's release could produce lots of negativity around the brand.

"With the well documented issues that the business is currently facing customers may look to other channels and retailers to make pre-orders in the future to avoid a similar inconvenience."

GAME face an interesting future, as they look to recover from this latest set-back. For now though, despite the lack of Mass Effect 3 and Mario Party 9, they are very much open for business.

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