Canada: Future Shop to enter used video game market

Best Buy, Canada's largest electronics retailer, will enter the second-hand games market with a test run at six of its Future Shop stores in Calgary, Alberta. They will then expand this venture to all 133 Future Shop outlets by late summer. By the end of 2008 or early in 2009, Future Shop hopes to have used game titles available from their website.

Best Buy is eager to take advantage of margins that are up to five times higher those of new games but the move will place then in direct competition with sector leader EB Games (GameStop Corp.) who has had a near monopoly on the sale of used games in Canada. HMV had previously investigated the sale of used games but it did not appeal to their core market of young women. Future Shop's customers, on the other hand, are mostly young males.

In order to get established in the market, Future Shop is initially prepared to undercut the prices of EB Games. Future Shop will target a margin "only" four times higher than new titles. The additional competition is likely to be very good news for Canadian gamers especially with the possibility of some sort of price war between EB Games and Future Shop.

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