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How to Become a Video Game Retailer

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Gaming isn't just for teenage boys anymore. Adult males, women of all ages and seniors are increasingly becoming gamers. TDG, the diffusion group, reports that by 2012, 190 million U.S. households will be using a next-generation video game console. If you have been looking for a way to break into this lucrative market, becoming a video game retailer could be the right move for you.

How to Become a Video Game Retailer

Find a wholesale distributor. Review its inventory, shipping and return policy. Compare it against a few different wholesalers to find the best deal. Japan Video Games claims to be the largest distributor in the United States. Others are Matcom Dist. and Regal Games. Contact a sales rep at the wholesaler and have a list of questions that will help you with planning the business and give you an idea of what you can expect. Ask about the experiences of other retailers. Important questions to ask include: "What is the average shipping timeframe?" "Is there a membership fee?" "What discounts are available to first-time buyers?" "Are there ongoing discounts?" "What is the minimum purchase amount?"

Write your business plan using the information that you have gathered from interviewing wholesalers and resellers. Predict the future. OneMint Financial advice blog writers suggest, "Here [in the gaming industry] the potential for growth lies in ever expanding technology, not in taking market share away from ... competitors." Forecast your potential profits and when you can expect to be profitable. Calculate how much money you will need for leasing retail space, buying games and consoles and keeping up with payroll until your business becomes profitable. List the emerging trends that you believe will make your business a success and how you can capitalize on them.

Consider franchise opportunities. Play N Trade is a leading video game franchiser. Based on your business plan and what you think you can accomplish with your video game store, contact a franchise representative and discuss options of going into business with an established brand versus building your own video game retail brand. Weigh the costs of start-up on your own versus the costs of buying into a franchise. Franchises have an approval process than can be more strenuous than applying for a business loan through a bank. They also will want to see that you can maintain the business without needing their help with a financial bailout. You also will be required to follow their policies and procedures for handling business.

Obtain a resellers license or a business license. Call your local municipal or county clerk's office and ask which is necessary for your retail store. You also will need a sales tax permit, and they differ from state to state and also can vary from county to county. Wholesalers often require these tax licenses before you can buy their products. Get both a business license and resellers license to be on the safe side.

Find a high traffic area for your retail location. Negotiate a favorable lease deal with the owner. Find building contractors with experience in building retail space for video stores and gaming stores. Design your store as a buy-only option. Don't allow gamers to play the games inside the store. You will end up with non-buyers who just hang out and cause problems. Make the shop inviting to casual shoppers and gift buyers as well as hardcore gamers.

Place your first order for video games and consoles. Buy "upsell stock," products that are complementary to the games you sell. Figurines and comics are popular upsell products. Don't be too conservative, or your first influx of customers may think you have limited inventory. However, don't go over your budget and buy more product than you can sell. Ask the wholesaler for a report of the best selling items.

Acquire employees who not only have retail experience but are accomplished gamers, as well. Gaming junkies can help gift buyers to make better selections so that you have fewer returns.

Use gamers to market your store. Create mobile applications that alert previous customers of new game arrivals and store events. Google apps will allow you to upload apps that anyone can download. Hire a designer who can create specialized apps for you.

Prepare to combat the digital distribution onslaught. Sony and other game manufacturers have threatened to distribute their products solely through their own websites and not allow third parties to sell their products. Create loyalty rewards programs. As a leading game retailer puts it, "As digital distribution looms, GameStop keeps opening retail stores. GameStop is also beefing up its loyalty rewards programs for its customers to keep people coming back to stores." Create value-added programs to get your customers to return to your store.


Sam Williams has been a marketing specialist and ad writer since 1995. He has been published in magazines such as "Reaching Out" and "Spa Search." He served in various sales and marketing positions with major corporations such as American Express, Home Depot and Wells Fargo. Williams studied English at Morehouse College.