Tesco games supplier goes on the prowl

Tesco’s exclusive distribution partner Handleman is going all out to secure similar deals with other leading games retailers – including specialists such as GAME.

Handleman’s MD James Wilding told MCV that the firm is in discussions with other High Street chains to expand its ‘fee for service’ model across the UK.

The news comes in the week that Handleman’s US operation was forced to suspend trading on the New York Stock Exchange. It is pending delisting as the operation’s average market capitalisation dropped below the NYSE’s minimum criteria of $25 million.

Wilding told MCV: We continue to talk to other retailers about other opportunities to expand this model in the UK. That applies to all retailers – not just supermarkets.

The stuff that we’ve been doing has been mostly grocery retailer-led, but we’re very open minded about working with specialist and general retailers alike.”

Tesco continues to buy direct from publishers, but Handleman takes care of replenishing stores and calculating ‘demand patterns’, as well as basic logistics and fulfilment. Wilding added that the UK operation was largely unaffected by its fiscal troubles in the US:

The shares will continue to be traded on a different basis in the US, so the ownership of the UK remains the same – as does our relationship with Tesco. We have a fee-service model here with Tesco. That’s a new model for large retailers and it’s going extremely well.”

Trilogy MD Matt Allen said of the deal: Video games are no longer a specialist commodity, so there is no need for a specialist wholesaler to sit in the middle. Tesco moving from EUK to Handleman demonstrates this. Handleman will have opportunities with more grocers and perhaps specialist retailers if this is their strategy.”