PS3 News: GameStop Used Game Sales Account For 42% Of Profits - PS3 News

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GameStop Used Game Sales Account For 42% Of Profits

GameStop is a company that just can't be stopped right now, and it's due in large part to the explosion of their used games business.

According to recent statistics gathered by Edge, used game revenue for the world's largest video game retailer hit $2 billion this fiscal year (which ends January 31). Now, that's nearly 1/4 - about 23% - of the company's total revenue, which is $400 million more than the previous year. Overall, the Wall Street Journal says that 42% of GameStop's profits come from used game sales, and as far as we're concerned, this isn't exactly surprising. As a side note, the Journal went on to talk about how publishers are trying to coerce consumers into buying extra content that can "only be used once." They say it's an example of "an effort to diminish the appeal of buying a used game," which does make some sense. However, as it stands right now, GameStop is raking in the big bucks by taking your used games in trade and selling 'em all over again...and for not much less than the initial price tag. Some may look down on this practice, but most gamers like the idea of trading in products they won't use anymore, if only to nab some extra cash for a new purchase.

Personally, the numbers don't surprise me in the least. And I hate to say this, but it's because GameStop gives less than they used to for trade-ins...but still sells them for the same amount. When I worked there during the late PS1 and early PS2 days, we'd give about half of what the game was worth in trade. So if a new game cost $50 and someone traded it in the next day, they'd get $25, or at least $20. Then we'd turn around and sell it for $45. Well, GameStop is now giving about 1/3 of what the game is worth, so a $50 or $60 might only get you $15 or $20, and they'll still sell it for only $5 less than the new retail price. So yeah...they're making a lot of money.

1/23/2009 Ben Dutka

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Comments (32 posts)

coverton341
Friday, January 23, 2009 @ 11:21:10 AM
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Gamestop kills on the used game front. They make money when the game is bought new albeit very little by comparison. They make money when the game is actually traded in and when it gets sold all the money from the sale is pure profit and if the game was traded in for cash which in the economic climate is pretty common they make even more money when the game is re-bought.

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MeXiCaNFiGhTeR
Friday, January 23, 2009 @ 11:21:23 AM
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There is nobody that can compete with gamestop!!!! :)

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WorldEndsWithMe
Saturday, January 24, 2009 @ 2:54:40 PM

That is the problem my friend, when I was a youngin there was between 2 and 4 sellers of used games, encouraging competition. Gamestop is is kind of like the game Nazis, and they despise Sony fans. Free market needs to return to this industry.

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Tim
Friday, January 23, 2009 @ 11:22:30 AM
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"selling 'em all over again...and for not much less than the initial price tag". I wouldn't say "much less". I get better deals on new games on amazon than used games at GameStop. As much as I enjoy the store itself.

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GuernicaReborn
Friday, January 23, 2009 @ 12:03:44 PM

Me too, Amazon all the way. The only time I got to gamestop is if I'm looking for a hard-to-find older game. You never know when someone is going to trade in a copy of Disgaea.

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whooka
Friday, January 23, 2009 @ 11:54:24 AM
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I noticed they got cheaper over the past year on what they will give you in the way of cash for a game, so much as now i think twice about selling or trading anything in there. They already are a few dollars higher for new games then most other places around me and, at least the one in my area, typically will not have any copies available of new PS3 games the first week they are released unless you preordered them. This is obviously due to the fact they are basing their initial orders almost solely on ones people prepaid or pre-ordered. When I first got my PS3 I used to like doing business with them but now I typically just go to the Big K across the road from Gamespot as new games are usually $5 cheaper and they almost always have them in stock for PS3. Plus the people that work at the Gamespot in my area are total slacker idiot types (I've nothing against the slacking types but the idiotic ones I do).

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JPBooch
Friday, January 23, 2009 @ 12:16:52 PM
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Screw gamestop, I rent from gamefly and keep it at a WAY cheaper price than their used game price and if I want to sell it back, I'll sell it on ebay. The only thing I got from there recently was the demo for Killzone, I probably will just get my 5 bucks back and use the above practice.

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fundando
Friday, January 23, 2009 @ 1:33:06 PM
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f these guys, they usually make it not worth buying or selling used games.

I wish more people would trade and sell on craigslist. it ends up being a better deal for everyone by cutting out the middle man.

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WorldEndsWithMe
Saturday, January 24, 2009 @ 2:59:54 PM

A-effing-men.

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Tim Speed24
Friday, January 23, 2009 @ 1:38:37 PM
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Doesn't suprise me at all. Car dealerships make alot more off their used cars than they do the new cars by employing the same tactics used at Gamestop.

I don't mind picking up a used game once in awhile that I wouldn't have paid full price for. There are some bargains out there sometimes.

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crapreviews
Friday, January 23, 2009 @ 1:43:22 PM
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I don't buy used games period. Just never trusted them...

Anyway the REAL point is this. First, all the people who choose to buy used games over brand new ones fail to realize that ANY used game purchased, no money from that purchase goes to the Developer of the game. Gamestop gets all the profit. You want Developers to put out new games but yet you not "really" supporting them when you buy used. [this excludes games that are no longer made]

Second, and this is an important one IMO. Developers need to realize that after a game has been out for so long you can NO longer expect most people to want to pay full price for a brand new copy. Why, oh WHY if a game has been out for over a year do you still sell it at full price. Example, Uncharted. I've been wanting to play this game, don't wanna buy it used cuz money won't go to the Devs, but don't wanna pay full price for a game that's been out way over a year. If a game has been out for over 6 months there needs to be some kind of price drop. If over a year, the price needs to go down even more.

Last edited by crapreviews on 1/23/2009 1:44:40 PM

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JPBooch
Friday, January 23, 2009 @ 5:13:02 PM

Dude, its a greatest hit...its only 30 bucks brand spanking new

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Wage SLAVES
Friday, January 23, 2009 @ 7:18:46 PM

My point exactly, well said MIXEDKID!!!

Last edited by Wage SLAVES on 1/23/2009 7:19:24 PM

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aaronisbla
Friday, January 23, 2009 @ 11:58:11 PM

JPBooch are you from europe? or some other country besides the US? i asked this because here in the US, its not a greatest hit yet, but overseas it is. Go figure

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crapreviews
Saturday, January 24, 2009 @ 8:19:52 AM

yeah i dont understand why EU has it for $30 but here in NA we don't.

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Gone
Friday, January 23, 2009 @ 2:49:24 PM
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So that's why I only got $2 for trading in Tekken 5.

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rjmacready
Friday, January 23, 2009 @ 5:36:42 PM
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Buying used games at Gamestop is pretty good (and better if you use the membership card giving you 10% off).

IMO, Selling games on Amazon is key though as far as selling them. I've sold over 20 games on Amazon for a lot more than Gamestop would have paid for them.
The best part is I sell them cheaper than anyone else on Amazon, still make a decent profit, and they sell usually within ONE DAY.
It's great cuz if I think I'll never want to play a certain game again, I'll sell it on Amazon and get cash to buy some other game that I'm interested in.

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Robochic
Friday, January 23, 2009 @ 5:42:07 PM
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the only time i trade is when they have the deals at ebgames where i trade in 3 and get a game, i've done that a few times. especially if i am unable to sell the games privately

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Wage SLAVES
Friday, January 23, 2009 @ 6:05:18 PM
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This is why we have a $60 price tag on our games. Imagine if all that profit was going to the publishers! We'd be back to $30 or $40 dollar games...

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DIsmael85
Friday, January 23, 2009 @ 6:44:30 PM

Actually folks, if you want to break it down, when you buy a new game you are pretty much paying the Graphic Designers and all those who helped with packaging and marketing that game. That's why trade is value is low. Reason being is Gamestop doesn't care for the packaging because it has no value, only the game itself. If you take out all those factors your game that you shell 60 bucks on is only worth probably about 15 bucks. How do you think those people eat. Enlighten yourselves folks, serious, this gaming generation is creating nothing but drones and people who don't like to learn. *shakes head in shame to be a gamer sometimes*

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Wage SLAVES
Friday, January 23, 2009 @ 7:15:35 PM

How does your point take away from the fact that the creators are getting jacked? Its all economics, ya know supply and demand. If there are tons of sales they don't have to charge as much.

If the same thing were going on in the movie industry we'd have $15 admissions tickets or something. Consider it enlightenment.

Last edited by Wage SLAVES on 1/23/2009 7:20:04 PM

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bigrailer19
Friday, January 23, 2009 @ 8:15:07 PM
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yea gamestop makes bank off us still love the store though, and ill be honest i buy used games from them in the right instance cus the 5 bux i save can go towards a reserve on another... but i only traded in some of my older ps2 games a couple times so i could get gta4, and fallout3 and ill be honest it didnt help much, i traded about half my ps2 inventory for 2 games, was it worth it? well yes considering the titles and since my 60GB crashed and now have an 80GB ps3 i have no use at the moment for ps2 games... all in all im against giving my games up for a dirt cheap price and not seeing much or anything in return except the sacrifice but then im so cheap myself ill trade what i can to get a good title! i hear blood or plasma goes for about 60 bux a visit these days?!?!

Last edited by bigrailer19 on 1/23/2009 8:19:04 PM

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DIsmael85
Friday, January 23, 2009 @ 10:50:04 PM
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@ Wages SLAVES: The creators are not getting jacked, do you have any idea how much money they make off of initial sales? We sell tons of reserves and thus those companies make money, when they sell their games like hot cakes. Take a look at Halo or GTA4. How does someone selling their game back to gamestop deserve to give those who made it more money? It doesn't. Once the game is sold that's it. They made their money. When you resale something, it is now at the stores cost. Which is why Gamestop makes money off of used games. Sure they jack up the price, but that's how someone said Car dealers do it. Would you expect a car dealer to take back your pre-owned vehicle at full value, when it is now used property? No, they will laugh at you. And the way the dealer is going to make profit off of the used vehicle is to charge more than what the bought it for. Supply and Demand have nothing to do with this, and if people are hurt when trading in games, then that's your own fault. No one is there with a gun saying you should, plus they did invent Rental stores for a reason. Try before you buy.

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Wage SLAVES
Saturday, January 24, 2009 @ 12:51:33 AM

Everything is supply and demand. So you are saying that the creators are entitled to the initial sales and that is all? It is a fancy version of piracy in my eyes.

And about that ingenious car argument, I say that an automobile is what you call a depreciating asset. Meaning you will never get the same experience that you would at the beginning. You will incur losses due to higher maintenance. But you will ALWAYS get the same experience from a game. A car also has a lifetime on it. Believe it or not.

Why is GameSTOP entitled to that extra cash that is nearly what a new game would have been. I swear used titles are like a measly $5 off. Just so GameSTOP can bank on the customer not choosing the new one.

A while back I bought Civ Rev new and the guy at gameSTOP tried to give me an open box. That is just shady business. Thats the last time I dealt with them. Ask yourself this..."Would I defend it if I had made the game..." Go ahead wheres your answer...

Last edited by Wage SLAVES on 1/24/2009 12:54:23 AM

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DIsmael85
Saturday, January 24, 2009 @ 2:12:53 AM

Ok Wage SLAVES, let's break this down for you. When you buy a new game from Gamestop, let's say you reserved this game. You just paid the initial $64.94 with tax to the guy behind the counter at your local Gamestop. The Gamestop company made a small percentage of profit on that game, a tiny percentage. The bulk of the rest of the cash you spent goes to the Marketting guy, the Graphic designers, and then the people who spent the time creating the game. The Disc you own now only cost a few bucks to create. You are not paying for the Game perse, you are paying the rest of the guys. That's how they make their money. Once you have played that new copy of the game, and then decide you wish you return it, why should anyone else come in and spend $64.94 on your previously played game? When you trade that game in you are getting in store credit what the game is initial worth to the company Gamestop, when they buy those games in. So if you buy a Copy of Gears of War 2 and then trade it in and only get back say 20 dollars store credit, you are getting back the base of what the game costs itself. That is why Gamestop and places like that will take in Games without case art. The Box and Manuals have no trade value, that was purchased when you bought it the first time. It's like buying a pair of Nike shoes. You are paying for the Name and Logo, not the shoe entirely. I can buy shoes that work and are probably way better than Nike shoes for way less. Which is how Nike makes it's money.

Back to the Gamestop situation. When they sell the game at a used Price of $54.99 it's about profit. The company gains profit to be able to pay it's "Employees". So if getting paid for my job is a bad thing, then I'm sorry, you are lost. If people decide to trade in their games without proper cover art, that is not Gamestops fault, like I said they have no value, only the "Game" itself does. If the game is still new, and is a sought after game, like Gears of War 2, then why would Gamestop as a business sell it for any less than the used price tag? The game is still a hot item.

As for a car, I believe your statement is wrong. That is subjective and depending on the driver who is buying the used car the experience may be the same as the person who bought it new to begin with. That is an opinion and not a fact. Games are the same way. They can wear out over time, and since we are using a disc medium for our entertainment, they can wear out quickly.

Ask yourself in the end if you think you deserve to buy a brand new game, play it, beat it, and then sell it back and think you should get back every penny you spent on a game you have just used. Then ask yourself if you think it's fair for someone to buy your used game for the same amount you spent on it, just because you think they will be getting the same experience from it that you did. It doesn't work that way. Which is why you will see all over the internet and sites that sell used games, the prices are they way they are.

People Bashing Gamestop need to sit back and think for a bit, and get their heads out of the Clouds. This is a business, that is surviving due to the fact that is has that ability to Sell, Trade used and new games. This company is not affected by an economic crisis, and is still able to open more and more stores. It's a "BUSINESS" Just like any other business. If you have a bad experience due to an employee, that is not the businesses fault, that is the idiot behind the counters fault. We as people have the ability to make choices. What will yours be?

Last edited by DIsmael85 on 1/24/2009 2:14:23 AM

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supremekai
Saturday, January 24, 2009 @ 12:31:42 PM

You're missing the point, DIsnael85 what Wage SLAVES is stating...
Wage SLAVES isn't talking about the money you get back when you sell your game used. Which you would get more selling it privately then to Gamestop.
I'm assuming you work at Gamestop thats why you're defending it. But anyways...

Well, look at it this way if a person was deciding between buying it used (let's say $55) and new ($60) from gamespot and decided to buy used. That money could be profits for the developers instead of $40 profits for Gamestop. What would money go to developers do? Yes, use to make games.

Now look at the bigger picture. If only a few hundred thousands of people buy a game new and sell them used and everyone else buys it used privately or not, the developers may not turn a profit. In the end it will only harm gamers, because the developers would not have [enough] money to make other games or make a game even better (time=money, more time spent on a game the better it might be, Killzone2 says 'hi').

Used games can also be "recycled". For example Gamestops sells a new game (they make their profit lets just say +$5 in this example) then the guy comes back and sells it to Gamestop (-$20) and then gamestop sells it(+$55) then from that person they sell it back to Gamestop (-$20) and gamestop sells it (+$55) ,etc.. so from 1 game Gamestop has a infinite amount of profit, pretty much... And the developers gets $0 from this... See the problem? If more people buy it new developers will get A LOT more money which in turn they can bring the price lower for consumers(gamers) and also use those money to make MORE games...


Last edited by supremekai on 1/24/2009 12:32:07 PM

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Bill_Clinton_
Saturday, January 24, 2009 @ 11:17:11 AM
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i stop buying games from gamestop a long time ago its just not worth it.. an i stop trading games in
because u trade a game in an gamestop gives you 20
bucks for it an then turns around an sells the same game for 45 dollars.. bs!!!!!!!!

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WorldEndsWithMe
Saturday, January 24, 2009 @ 3:06:43 PM
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Ok, this is my bottom line so listen up and take notes.
1.Chances are the tiny sum Gamestop will give you for your game isn't worth it unless you unfortunately bought a piece of crap because you might want to play that game again somewhere down the line.
2. If you are going to buy a used game and don't really trust them, ask to inspect the disc for imperfections.

That is all.

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DIsmael85
Saturday, January 24, 2009 @ 9:48:02 PM

Thank you. Nuff said, and yes I have stated on this site a million times I work at Gamestop. I do not always agree with the companies decisions, but I enjoy helping people find what they would like. I like expressing my love for games to them and having them smile back when they like what I have helped them find. If that's so bad, then sue me.

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dirdiggler
Sunday, January 25, 2009 @ 10:04:53 AM
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Gamefly, its the only way to go!! They let you trade in your games an buy used games there now. Give it a try, u trade in your games an it counts towards your membership fee's..

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BikerSaint
Sunday, January 25, 2009 @ 11:45:46 PM
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I buy most of my games online & from different gaming stores, but mostly from 5 different Gamestops within 10 miles of me.

FYI, I alway buy them used, & only when they come down under the $10-$15 dollar range(but only if they have the case, art & mamnuals too, and are no worse than a few fine scratchs witch I'll buff out. I find alot of older-but PS1/PS2/Xbox goodies in their bargain bins from $1.99 to $7.99 too

I think in the last 10 years, I've only paid more than $14.99 twice for a game, $29.99 for a rare used Ace Combat Zero:The Belkan War, and $24.99 for Ace Combat 5: The Unsung War.

But the best deal I ever got was from an employye of another used games store going out of biz. The store had about 3 days left on their shopping center lease & I talked the kid working therre to sell over 300 PS1 games, and all their Gaming console signs, & posters for only $75.00. Damn if I didn't feel like I got away cleanly from robbing bank(and without any red dye packs staining my loot either).

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opsdaddy
Monday, January 26, 2009 @ 7:25:25 AM
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@BikerSaint: Being frugal is cool and all, but there ARE drawbacks to your game acquisition strategy. When I first picked up my PS3, it was a financial stretch for me. So, like you, I began to pick up PS3 games months after their initial release for a song. One of those purchases was Unreal Tournament III, which, as you know, is all about online gameplay. However, when I went online, it was like a digital ghost-town. Because I was a late-adopter, most players had already moved on to bigger, better things.

Since then, I've modified my buy-cheap strategy: if it's a game that I'll be playing offline, I'll wait for a price drop; but if it's a game where online play is king (i.e., KZ2) then I purchase it early. Works for me...

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