simes wrote:They may have been shifting a lot of stock, but it hasn't generated any income.
So you have seen their revenue numbers from the "Spring Clean" then?
It's been mixed but combining the stock that has been traded in and the use of points, it probably hasn't brought as much money as it might look. Personally, I've spent about £250 in cash and another £20+ in points but I have seen quite a few people pay with just points. Even though they have received an incredible cash boost since the sale started, taken across the whole country and their entire customer base there have been millions of pounds of points spent over the last couple of weeks which won't
have helped. It is a debt that needed clearing but as with all loyalty points companies rely on the fact that points will be spent gradually over a period of time and what has happened to Game right now is that every single customer is using all of their points now
The same thing could have a devastating effect on even the strongest of retailers but for one in the position that Game is in right now, it could push them even further into trouble as they won't have the cash coming in to make up for the lost income for stock that they are effectively "giving away". While there are inactive cards out there, there are an estimated 19m cards out there (source: MCV) and all of them have points on them. Even if only 10% of those cards were active and only had a minimum of £2.50 on them, that's a debt of £5m that Game would have to "pay" it's customers overnight. As I said though, the majority of people seem to be spending more on their cards so the Reward Card debt situation seems to be a lot more drastic. A debt of £25m+ isn't an unrealistic estimate spread across the entire company and it's one that we're all calling in before the company collapses.