GameStop guns for growth
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Single instance of business apps to support international expansion at games retailer.
The pictures in mid-September of hundreds of eager gamers queuing around the block to get their hands on the futuristic gun-fest Halo 3 represented a watershed for the gaming industry.
On the back of those initial purchases, the game posted the kind of first-day takings that put most Hollywood blockbusters in the shade.
According to market watchers, GameStop, the $5 billion retailer of video games and consoles, could ultimately generate over $80 million in revenue from Halo 3. But the pressure to feed that demand has compelled GameStop’s management to deploy some battle-ready and disruptive kit of its own.
Specialised business apps
The idiosyncrasies of the gaming market call for some highly specialised and responsive business applications – particularly on the supply chain management and business analytics side. As Ian O’Casey, director of IT at GameStop International, explains, its “uniquely perishable” products have high retail value relative to their shelf life, and customer loyalty can be patchy. In the days after a high-profile release, such as Halo 3, customers will turn around and shop elsewhere if the shelves are empty; after a couple of weeks, demand dwindles to a trickle.
GameStop also has some quirky business practices that meant off-the-shelf retail application packages were not an option. Alongside shelf-loads of the latest games, it also stocks second-hand titles. Most retail applications wouldn’t support that sales channel as a matter of course – so having software that could be modified and tailored, without costing a fortune, was paramount, says O’Casey. As indeed was having “a partner with the industry expertise to customise the software”, he adds.
Outside its home market in the US, GameStop is currently deploying Microsoft Dynamics NAV to manage its whole product sales cycle, from purchasing to store allocation. The company is growing rapidly, fuelled by acquisitions, and bringing its international operations onto a single platform is a priority, says O’Casey.
In its Nordic regions, the company has already managed to close down legacy AS/400-based JD Edwards merchandising systems, and Lawson-based warehousing applications. The new “scalable and flexible” Dynamics NAV system went live, populated with 16 months of sales data, in August 2007. The rollout of the system, covering all of its non-US stores, will continue over the next two years.
When in place, the single instance of ERP will help the company track sales, model demand and organise supply chains across multiple countries (getting a detailed breakdown for each), says O’Casey. It will also mean that gamers won’t be queuing in vain for the latest releases.
Further reading
Microsoft's Dynamics aim November 2007
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