Every person in this world wants to turn their hobby into their job. Sadly, not many have this kind of opportunity. But if you are a gamer, and looking into starting your very first video game store, now is the right time to do it.
Currently, the video game industry is booming. The industry raked in $153 billion in sales last year, surpassing both the movie and sports industry combined. The pandemic has contributed to this increase in sales. As more people are converted to gamers over the span of one year, experts believe that this growth will continue for many years to come. The video game has become part of people’s essentials, and everyone is trying to get a piece of it. If you’re planning to start your first video game retail store this year., here’s what you need to know.
Business Plan and Research
Just like any business, you’re going to need a business plan. List down your business’ goal, services, and products. Don’t forget about your mission and vision as well. It’s primarily aesthetic, but it can help streamline business goals. Next up is to do research not just on the market but also on your competitors. Concentrate on those in proximity to your shop. If you’re planning to go digital, look for competitors that might be dominating the market, and then ask yourself, what can you do that’s better than any of them? Think of ways you can navigate this growing industry.
Let’s go through the possible overhead cost of your first shop. There isn’t clear detail regarding the average cost of video game stores, but typical retail businesses require you to have $25,000 in the bank while another $25,000 on hand. That might be much money, but having that much money will let your business run for over a year.
Additionally, let’s look into your possible revenue: it’s estimated that you earn $50 for every video game you sell. The average retail space costs about $3,642 per month. This means that you have to sell about 73 video games per month to pay for rent. This can be tough if you rely on video game sales alone. This is why you have to offer other options in your shop.
Offer Digital Options
We’re not going to delve too much into the art of physical retail because, currently, digital sales are driving the video game market. Your best option right now is to go purely digital or have your retail store offering digital options. Here’s why.
Digital Sales Are Driving the Market
Just as we have stated earlier, digital sales are at a whole time high in the industry. In 2018, 83% of video games were sold in digital form. This is a staggering growth when you compare it to the years before. Last year, digital sales constituted 91% of the revenue made by the entire industry. This is equal to $143 billion in sales. Many experts believe that this is because of the pandemic. However, many more experts explain that it’s inevitable, and the pandemic only expedited the event. Regardless of the reason, if your shop does not offer digital options, you’re most likely to miss thousands of dollars in revenue.
Digital Sales Are Going to Pay Your Rent
Marginally, retail rent in the US is quite expensive, and you’re going to need something to pay for your rent. Thankfully, digital sales don’t take up any space, which means that all your revenue from those sales can directly pay for your rent and other expenses you might have in your retail store.
Consider Going Fully Digital Early On
With this in mind, it might be better for you to go fully digital early on. Set up a website that sells digital video game keys while offering digital payment options, and you should be good to go. The cost of maintaining a website is a fraction of the cost of a physical one. You can start renting a physical space once the pandemic has ended or when you are planning to add services to your stream of revenue.
Services as Expansion
Services are at the top of your list when it comes to expanding your business in the future. They can easily supplement your sales and boost your revenue when done right. One of the best services you can give to your customers is the ability for them to build their gaming computers. Gaming computers are becoming more popular in the market, and their sales can rival gaming consoles. With next-gen consoles becoming rarer than ever, many gamers are looking into purchasing a gaming computer instead.
Other services you can do are cleaning and maintaining both video game consoles and gaming computers. You can also sell individual parts, as this can make your sales more flexible. You could also sell other things such as table-top RPGs and board games in your shop. All of these things can drive revenue if your video game sales aren’t all that good.
These are some of the essentials when starting your first video game store. You should consider starting purely digital early on if you want to depend on video game sales. Once you are known in the community, you can start thinking about opening a physical store that offers services and other products to gamers. This way, you don’t have to lose too much money before getting started in the market.
Meta title: Essential Elements When Starting a Video Game Store
meta desc: The video game industry is booming right now, raking in billions in sales. If you plan to join this industry, learn about some essentials you should note.
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