GameStop
From Wikipedia, the free encyclopedia
| GameStop Corporation | |
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| Type | Public (NYSE: GME) |
|---|---|
| Founded | 1984 (as Babbage's) |
| Headquarters | Grapevine, Texas, USA |
| Key people | R. Richard Fontaine (Chairman, CEO), Daniel A. Dematteo (Vice-Chairman, COO), David W. Carlson (CFO), Steve Morgan (President) |
| Industry | Electronics Stores |
| Revenue |  $1.842 billion USD (2005) |
| Employees | 33,000+ |
| Website | www.gamestop.com www.ebgames.com |
GameStop Corporation (NYSE: GME), headquartered in Grapevine, Texas, USA, is the world's largest video game and entertainment software retailer. The company operates 4,592 retail stores throughout the U.S., Canada, Republic of Ireland, United Kingdom, Australia, Denmark, Finland, Germany, Italy, New Zealand, Norway, Spain, Austria, Puerto Rico and Sweden.
Retail stores operate primarily under the GameStop and EB Games brands but also operates under Software Etc., E.B.X., Babbage's, FuncoLand, and the recently acquired Rhino Video Games. In addition, the company runs two ecommerce websites, GameStop.com and EBgames.com, and Game Informer magazine, a leading video and computer game publication. In addition to video and computer games, GameStop sells magazines, strategy guides, entertainment DVDs and other related merchandise, along with buying used games and movies from its customers. A new store concept called MovieStop, which focuses on selling movies as opposed to games, is currently building and operating stores in the Southeastern United States.
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[edit] History
[edit] Babbage's and Software Etc.
GameStop traces its roots to Babbage's, a mall software retailer that started in Dallas, Texas in 1983. The movements that made Babbage's into GameStop started in 1994 with a series of mergers. The first was with Software Etc. in 1994, the second was with Funcoland stores in 2000, and the third was with Electronics Boutique (now EB Games) in 2005, taking four competing, major mall software retailers and placing them under a single corporate umbrella.
When Babbage's merged with another mall software retailer, Software Etc., in 1994 [1] the combined company was named NeoStar Retail, but the two halves continued to operate as if they were separate entities.
The combined management of the newly formed entity developed a classic case of the right hand not knowing what the left was doing. This ultimately caused NeoStar to go into Chapter 11 reorganization in early fall of 1996. At this point the company had approximately 800 stores in the United States. Several potential buyers of NeoStar's assets emerged. Ironically, given the merger to come in 2005, one of the potential buyers was Electronics Boutique. During the annual managers' conference in early November of that year, managers were facing the very real possibility that they may not have jobs or even stores to go back to. They were told at a lunch time update that unless something happened in 24 hours, NeoStar would be going to liquidation.[citation needed]
[edit] Leonard Riggio
On the last day of the manager's conference there was a special guest during lunch. Leonard Riggio, the head of Barnes & Noble, announced that he and a group of investors were going to put in place the financing to keep the company afloat, and get new merchandise into the stores in time for Christmas. (At this point, the company's creditors were owed so much back revenue that they were no longer shipping anything to NeoStar.) Riggio and his investors would also be making a buyout offer to the bankruptcy court in the coming week.[citation needed]
In a personal comment during the address, Riggio stated that he "hated" the name Neostar Retail, and thought that the merged Babbage's/Software Etc. should have been called Babbage's Etc. He said should his buyout bid be successful, and he was boldly confident it would be, that the company would be renamed.
From the potential buyers, the judge desired to accept the offer from the one that would keep the most people working and preserve the most competition, consumer choice, and be the most stable. Ultimately Riggio's offer was accepted on the day before Thanksgiving. Ironically Barnes and Noble, through B. Dalton, was the original owner of Software Etc. A new management team largely composed of former Software Etc executives, and long time associates of Len Riggio was put in place to run Babbage's Etc.
[edit] 1996 Closures
The day after Thanksgiving 1996 approximately 100 Babbage's and Software Etc stores were closed. The remaining merchandise from these stores was shipped to 100 of the remaining stores that would participate in a massive 'going out of business' sale throughout December. These 100 stores would close for the last time on Christmas Eve, and all merchandise left would be shipped back to corporate headquarters by New Year's Eve. The company would be pared back to about 600 of its best performing stores.
The newly-streamlined and reorganized company performed better than anyone could have expected. The turn around was dramatic. By February 1997 there was already talk of reopening several of the closed stores. Many of the stores reopened and moved into the same space they had left only months before, dramatically saving on opening costs. They only needed to be repopulated with fixtures, equipment and merchandise, the counters and walls of the vacated store still being in place as the malls had not yet rented to them to new permanent tenants that would have renovated the space. Along the same lines, a majority of the store's former staff was simply put back in place or rehired.
[edit] Acquisition by Barnes & Noble
When Funco, Inc. (operator of FuncoLand stores) was acquired by Barnes & Noble in 2000, there was a corporate restructuring, and Babbage's Etc became a wholly owned subsidiary of Funco. The name at that time was changed to GameStop, Inc.
In 2002, GameStop bought out the Gamesworld franchise in the Republic of Ireland and immediately took control of their 10 stores; the company now operates over 20 locations in the country.
On November 12th, 2004, GameStop spun off from Barnes & Noble. Due to Riggio's involvement, GameStop and Barnes & Noble employees still receive employee discounts at each other's stores, despite the companies being completely separate.
[edit] Merger with EB Games
GameStop and EB Games announced on April 18, 2005, that they had entered into a "definitive agreement and plan of merger". After shareholders and US regulatory agencies approved it, the merger closed on October 10 of that year. Due to the impending holiday season, virtually no customer-noticeable changes were made until 2006. After the new year started, however, integration of the two companies was ramped up, starting with the realignment of districts and the closure of EB's West Chester, PA headquarters. Through the spring and summer, GameStop stores transitioned to the EB Games' Windows-based POS (Point of Sale) system, which replaced GameStop's aging MS-DOS-based program. As of the end of 2006, the remaining differences between individual stores are primarily a function of stores' interior design and layouts, based on when they were built and what company owned them at the time. Both EB Games and GameStop stores have several distinct designs.
While most of the marketing aesthetic has been retained from the EB Games side of operations, policy changes throughout 2006 were a mixture of what corporate had determined were best practices from both sides of the company. Things such as the policy of allowing a single employee to close the store (in contrast to GameStop's former policy of there always being at least two people present at close) were introduced to GameStop, while merchandise checkout, a GameStop policy, was brought to EB Games.
On January 4, 2007 GameStop Corp. officially purchased Rhino Video Games from Blockbuster.
