INTERVIEW: A Game Distribution

What sets A Game Distribution apart from other suppliers?

We are a full service distributor of video games, accessories and consoles focused on supporting the international independent market as well as the promotions market.

We can offer fully branded white label logistics for any store or promoter in Europe.

How important are independent retailers to A Game Distribution?

The independent market – which includes single stores, internet retailers and small chains – is certainly our key focus when it comes to distribution.

With margins being so tight, it’s essential the price points are as competitive as possible – our unique ‘day three delivery’ price break allows indies to take better pricing a few days after release. We also support Europe as a whole and not just the UK.

Which games do you distribute?

We have primarily focused on triple-A new releases since the beginning of October 2010 with products such as Donkey Kong Country Returns.

We also encourage our customers to let us assist in sourcing hard to find and discontinued SKUs.

What kind of promotional services do you offer?

We offer gaming products and logistical services to the promotions market as a whole. We can guarantee the levels of stock required to run a successful campaign in today’s video game market. This is a key requirement for many promoters.

Will you embrace digital distribution?

It’s still very early days to say. Whilst the PC market is slowly starting to embrace it, both the UK’s broadband infrastructure and certainly the gift buying market will keep physical distribution alive for a long time to come.

Also, the average PS3 game is over 30GB, whilst the average consumer receives just 3GB of data allowance per month.

What is your biggest challenge?

Starting a new business in some of the toughest trading conditions experienced in recent years. It’s all about cost control.

We are fully budgeted down top to bottom and we are continually looking to reduce costs whether through courier contracts, warehousing or travel. We also employ specialist market brokers to handle our foreign exchange and maximise our return per pound.

How has the retail distribution market changed over the past 12 months?

Margins are certainly tighter. Trade prices of games now fall regularly below the 30 mark as consumer demand, coupled with aggressive pricing from nationals and supermarkets, drive the retail value of games down to low levels.

We’ve also noticed that the shelf life of a new title at release day has now shortened down to two weeks before the price drops. And as the pre-owned market booms, this further drops the retail value. Just two years ago the shelf life of a new release was expected to be six to eight weeks.

How much are pre-owned games a blow to your business?

It clearly has had a knock-on effect. The length of time that a new game can hold its release day price has significantly shortened due to the growth of pre-owned games.

I’m a firm believer in consumer rights and trade-ins have made gaming much more affordable. However, I think we’ll start seeing fewer triple-A releases but greater depth via DLC, as the industry gets used to the pre-owned sector sharing a significant chunk of the market’s revenue.

More publishers will tighten their grip on the value of the content and less so in the disc being sold.

What is your target for the next 12 months?

We hit both our turnover and profit targets for our first financial quarter and achieved month-on-month growth which we look forward to continuing in our second quarter.

Also, we are looking to expand our sales team and open additional warehouse space later in the year.