As somebody who works in a retail store (Grainger Games), most of us 'in the industry' (as pompous as that may sound being essentially a retail clerk) have seen this coming a mile off.
GAME got incredibly greedy; they've relied almost solely on brand recognition for their business for years, selling to parents who haven't got the wherewithall to look elsewhere, where they will undoubtedly find the same product on average 20-40% cheaper (Supermarkets and online retailers in particular). For years, they have gotten away with charging full RRP on almost everything in store. Their entry into the pre-owned market was both misjudged and non-competitive; their prices according to ahem, sources, are on average 25% lower for trade-ins than the likes of cEX and Grainger, and the sale price as much as 50% dearer on a consistent basis.
It is the GAME group who most forcefully and loudly rejected publisher's requests for profit-sharing of preowned games, forcing EA and now others to introduce 'online passes' as their way of taking a slice. Now they find themselves in the cold from the same publishers, and unable to fill their shelves with stock (albeit also for a number of other complicated reasons). Greedy.
Also, the curse of GameStation hasn't helped them. GameStation was owned by Blockbuster and for years was their only profitable sideline - albeit at a cost, as most GameStation's were in direct competition with Blockbuster's and naturally wiped the floor with them. After GAME aquired them (very dubiously in terms of monopolisation, in my opinion) the EXACT SAME THING has happened. GameStation is considerably more profitable than GAME thanks to its roaring preowned trade. GameStation makes GAME look bad just like it did Blockbuster.
Word is GAME Group will be gone within two years, regardless of the 'planned slimlining' they've openly discussed - it looks like it will be taken out of their hands. Nobody will acquire them as the brand is practically worthless anyway. But don't get me wrong is a terrible thing for the future of physical video games. It will affect everybody selling entertainment on the high street and potentially the existence of physical gaming media full stop. If only GAME had acted responsibly at their peak and tried to compete with the emerging online sector, none of this would've happened and a lot of people would still have jobs.
XBox 360 Gamertag: jcdentont1000
Nintendo 3DS Friend Code: TBC (Now, where did I leave my 3DS..)
"Trust no one. Question everything."