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Choices’ voice

Choices’ voice
Few High Street retailers can boast of having as successful a Christmas as Choices UK. The company’s recently released half year fiscal results ending February 10th showed a significant increase in sales – and it has been quick to give much of the credit to games.

Revenues jumped up to £86.1 million in the 28-week period, whilst losses were reduced to £265,000 from £2.9 million a year before – and CEO Anthony Skitt says the accomplishment has lead to a refocus on interactive entertainment.

“Games have been a star performer, which is why we’ve increased our games space by upwards of 1000 metres in the last 12 weeks,” says Skitt. “We carved out some of the DVD space for Nintendo consoles at Christmas time and we planned to take that back down again post PS3’s launch. But it’s actually gone the other way.

“We’ve been eating into more and more of our DVD space. There are now three or four metres of hardware in most of our key stores, whereas previously that was no more than a metre – basically one cabinet.”

Skitt is very keen to point out that the majority of Choices business is actually no longer in High Street retail, but in the supply of games and books to other outlets – following the acquisition of Andromeda last year, which also brought mail order services with it.

“We have a bit of an issue because we’re primarily seen as being a retailer, and as a rental operation within that,” clarifies Skitt. “52 per cent of our business now is distribution. 48 per cent is retail, and rental also accounts for 24 per cent of that. Games stands as 39 per cent of our retail mix, making it the largest category we do. To give that some context, DVD sell through is 19 per cent.”

As part of its triumphant revival, Choices has ‘rationalised’ its product range, discontinuing mobile phones, portable electronic goods and impulse lines, which helped the store claim a 6.5 per cent market share during the opening weekend of the PS3 launch.

“Although that was an extraordinary result for us we’re not aiming for any particular overall market share of games retail – it’s not something we wish to become obsessed with.” In the past seven months, Choices has closed 31 loss-making stores and a further 29 have now been earmarked for disposal. Once the restructuring process is complete, the chain will be left with a healthy 162 outlets.
“Because of the downsizing we tend not to compare ourselves with other games retailers in term of like-for-like stores,” adds Skitt.

“And we’re a diverse company now so it’s a bit complicated.”
With a ruthless purge of its store base underway, as well as a varied core business that includes High Street and online retail, product fulfilment and mail order, it appears that Choices is one retailer that can truly afford to keep its options open.

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