# Disgusting



## Joecoral (10 Oct 2008)

Click

The industry was rocked by heavy discounting this week, as High Street giants GAME and Gamestation joined independent retailers in buying extra stock from supermarkets.

The latest round of price slashing kicked off at Sainsburyâ€™s over the weekend, with the retailer cutting Â£30 off the price of Xbox 360 and Wii hardware â€“ an offer which meant the 360 was available for under Â£100. Armies of staff from GAME, Gamestation, CHIPS and numerous independents then swooped to snap up the cut-price consoles.

â€œWith 360 and Wii on sale at these prices we allowed our store managers to supplement their stock by buying consoles from their local Sainsburyâ€™s,â€ explained GAME Group CEO Lisa Morgan.

â€œAvailability was very inconsistent, but on the whole it was a worthwhile exercise. Our strategy is centred on giving our customers choice, good value and having the best possible availability going into the Christmas period.â€


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## GreenNeedle (11 Oct 2008)

I can't se a problem with it.  If Sainsburys are selling them cheaper than they can get them for or they are struggling to get the supply then its standard practice.

Corner shops, pubs and bars will buy stuff from supermarkets if it is cheaper than their wholesaler.

An off licence I setup for my boss a few years ago regularly bought the cases of beer from supermarkets because it was cheaper than Bookers.

My Dad often buys soft drinks from supermarkets rather than the brewery because it turns out cheaper for his bar.

Standard practice,  its not a case of them trying to wipe out cheap sales to keep their price up.  Its supply and demand.

AC


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## Mark Evans (11 Oct 2008)

i dodnt see a problem neither. the only problem is the fact that gamestation etc were buying them, not giving a chance to normal folk like us.

because we all know those consoles are going to be sold on....at a profit.thats wrong.

supermarkets are know to sell stuff even without a profit margin, just to get people through the door.


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## bugs (11 Oct 2008)

Smart move as far as I can tell. They achieved two objectives... Bought stock for less than they can sell it on (normal retail practice) and protected their margins on the stock they have. They also did other retailers a good turn too - protected their margins.



			
				saintly said:
			
		

> because we all know those consoles are going to be sold on....at a profit.thats wrong.


What's wrong with a retailer buying stock for less than they can sell it and then selling it? That's retail.


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## aaronnorth (11 Oct 2008)

> supermarkets are know to sell stuff even without a profit margin, just to get people through the door.



they may raise the price this week by 10p, then lower it 5p next week, you are still paying 5p more than originally!! its surprising how many techniques they use, like dim lighting to make you shop longer as you feel more safe, you dont notice these things though...


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## Mark Evans (11 Oct 2008)

bugs said:
			
		

> What's wrong with a retailer buying stock for less than they can sell it and then selling it? That's retail.



thats what wholesalers are for. these machines are for the public, not trade!


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## GreenNeedle (11 Oct 2008)

At the end of the day you should complain about the big supermarkets using their buying power to buy so many which then leaves all the other smaller 'specialist' retailers struggling to get the stock and having to resort to buying off their competitors to make sure they have a decent supply.

Sainsburys and Tescos effectively try to strangle every market they go into which in the short term is good but once they succeed and drive the more specialist retailer into the ground and out of business then they can raise their price as their competition has gone.

This may be good for prices but you lose the expertise that you have when you buy a hi-fi from a hi-fi shop.  Specialist shops in the main will have knowledge of their market whereas Sainsburys and Tescos will have knowledge of hardly anything on their shelves.

AC


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## aaronnorth (11 Oct 2008)

saintly said:
			
		

> bugs said:
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i see what you are saying but skipping the wholesaler means bigger profit margins for GAME


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## Joecoral (11 Oct 2008)

What it boils down to IMO is artificial manipulation of the market
There is no way a company like GAME need to "supplement" their stock by buying from a supermarket
It's better for them to buy up all the cheap consoles and sell them at a reduced profit, than to sell nothing at all because they are being undercut by Â£30 by the supermarket


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## bugs (11 Oct 2008)

Joecoral said:
			
		

> What it boils down to IMO is artificial manipulation of the market
> There is no way a company like GAME need to "supplement" their stock by buying from a supermarket
> It's better for them to buy up all the cheap consoles and sell them at a reduced profit, than to sell nothing at all because they are being undercut by Â£30 by the supermarket



Yes. Absolutely spot on. That's retail in a capitalist market. 



			
				saintly said:
			
		

> bugs said:
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Not if you're in the business of retail. There's not doubt about it, Game made a solid commercial move. 

(I'm biased - I worked in retail buying for 20 years (now retail supply chain))... What can I say


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## GreenNeedle (11 Oct 2008)

Joecoral said:
			
		

> What it boils down to IMO is artificial manipulation of the market
> There is no way a company like GAME need to "supplement" their stock by buying from a supermarket
> It's better for them to buy up all the cheap consoles and sell them at a reduced profit, than to sell nothing at all because they are being undercut by Â£30 by the supermarket



I think you missed the point here.  There is such demand for these new consoles as we all know, that if some huge place like Sainsburys or Tesco buy up a huge amount it means the actual gaming retailers may have to go into their most profitable period (christmas) knowing they don't have enough stock.  The supermarkets know this which is why they do it and are pushing further and further into each market doing the same.  They are already eating into the clothing market and this is why choice on the high street is dropping.  Normal electronics are now virtually your big electronics retailers versus the supermarkets which means that all the places like SuperFi who actually specialised in HiFis will soon be a thing of the past.  No more specialists.  As much variety as you can of different products under one roof with someone who 'blags' knowledge rather than has it. 

If they don't have a profitable christmas in the current climate I would bet that these companies would be struggling to continue next year and if they can then the supermarkets will strike some deal with the manufacturers again to make sure they have a bad year.

Places like Game etc will know that they are likely to sell a console and at least 1 extra game with each sale so they are not just looking at 1 sale, they are looking at 2+ sales.  They can strike a cut in their margin but cannot compete with a huge company because Sainsburys overheads are covered by several thousand different lines with much higher margins that electronics.  namely food and drink.

Not that I would say in this case it was a case of support your local shop as Game are a huge chain but it is a shame that you can't go somewhere where they know what you are on about and know what they are on about to buy the product that they are experts at.

If the supermarkets sold aquarium plants and fish would you buy from them or the fish shop.  I wonder what advice Mr 'blag' salesperson would give.

At the end of the day if its on the shelves then its first come first served simple as.  I've bought up loads of a BOGOF offer before or good 'sets' and then split them up for sale when I was selling.  I used to buy direct from the internet shops if a sale was cheaper than the wholesalers or importing and then sell them at my price.

Its good business and nothing wrong with it.

AC


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