UK price-war tainting foreign markets

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Hyper-competitve price cutting in Britain hurts EMEA retailers.

UK games retailers' cost-cutting price wars are dragging down foreign retailers, according to businesses across EMEA regions.

In a report compiled by MCV, the UK's downward trend in games pricing has seen other countries take the bait and import their stock from Britain, which in turn causes price wars in their own regions.

“A widespread phenomenon in Egypt is that several small business owners now import games from the UK,” Egyptian chain GameSword's Mohammed El Masry explained.

“And this is how we work. We have been able to make contact with large UK suppliers offering us good wholesale prices.”

With UK imports, foreign businesses enter into price-slashing competition with each other that starts to drain profit from their markets.

This opinion was reflected by retailers in the Czech Republic, Iceland and the United Arab Emirates, who all said low-cost gaming in the UK was impacting on their business.

Early this year, Webush Securities managing director Michael Pachter pinned the blame for recent UK retail busts, such as Blockbuster and HMV, on the drive to sell games at a loss.

"The UK games retail market is a joke, with retailers pricing below cost to drive traffic," he explained.

“Retail needs to make money to exist, and games retail in the UK doesn't make money."

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