As the video game industry shifts to digital, physical retailers have become less relevant. The GameStop subreddit has multiple reports from employees claiming their store leaders and district managers have been laid off, allegedly due to the company’s decline in profits. The layoffs are even impacting regional managers. In June 2019, GameStop’s stock value plummeted 36%, a sign that the retailer is in trouble. Now, with reports from so many employees claiming their managers are being let go, things aren’t looking good for GameStop.
One Reddit user said, “Retail is falling HARD. Lot of stores I grew up with, Sears, JC Penny, Yonkers, K-mart, Radio Shack all seemed like places that’d be there forever.” Another user said the leaders would be taken care of after being let go, stating, “From what I understand they got fabulous packages that compensate them with almost a year of pay if they don’t go to a competitor to find a new career path.”
The holidays for GameStop are always the most busy, and many employees are concerned with the timing of these layoffs. Of course, there’s never a great time to be let go, but considering the bulk of the company’s traffic takes place during the holidays, stores might not be as prepared at the end of 2019.
Earlier, we reported that GameStop was planning to restructure its business model, testing different store renovations that are aimed to be more “experience” focused. A press release indicated that stores would be looking for ways for customers to try games before buying them, as well as local competitions, along with dedicated retro stores.
We’ll have to see how these changes impact the company and if they will be enough to bring GameStop back into a profitable space. It’s important to adapt the market’s changes, so perhaps this new business model will help.
We wish those affected by the layoffs the best and hope they land on their feet soon.