GameStop 2005 Annual Report Download - page 17

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increases store traffic and promotes customer loyalty, leading to increased sales of video game software and
accessories, which have higher gross margins than video game hardware.
PC Entertainment and Other Software. We purchase PC entertainment software from over 45 publishers,
including Electronic Arts, Microsoft and Vivendi Universal. We offer PC entertainment software across a variety of
genres, including Sports, Action, Strategy, Adventure/Role Playing and Simulation.
Accessories and Other Products. Video game accessories consist primarily of controllers, memory cards and
other add-ons. PC entertainment accessories consist primarily of joysticks and mice. We also carry strategy guides
and magazines, as well as character-related merchandise, including action figures and trading cards. We carry over
200 SKUs of accessories and other products. In general, this category has higher margins than new video game and
PC entertainment products.
Store Operations
As of January 28, 2006, we operated 4,490 stores, primarily under the names GameStop or EB Games. Each of
our stores typically carries over 5,000 SKUs. We design our stores to provide an electronic gaming atmosphere with
an engaging and visually-captivating layout. Our stores are equipped with several video game sampling areas,
which provide our customers the opportunity to play games before purchase, as well as equipment to play video
game clips. We use store configuration, in-store signage and product demonstrations to produce marketing
opportunities both for our vendors and for us.
Our stores, which average approximately 1,500 square feet, carry a balanced mix of new and used video game
products and PC entertainment software. Our stores are generally located in both high traffic “power strip centers”,
local neighborhood strip centers and high-traffic shopping malls, primarily in major metropolitan areas. These
locations provide easy access and high frequency of visits and, in the case of strip center stores, visibility. We target
strip centers that are conveniently located, have a mass merchant or supermarket anchor tenant and have a high
volume of customers.
Site Selection and Locations
Site Selection. In the U.S., we have a dedicated staff of real estate personnel experienced in selecting store
locations. International locations are selected by the management in each region or country. Site selections for new
stores are made after an extensive review of demographic data and other information relating to market potential,
competitor access and visibility, compatible nearby tenants, accessible parking, location visibility, lease terms and
the location of our other stores. Most of our stores are located in highly visible locations within malls and strip
centers.
Locations. The table below sets forth the number of our stores located in each state, the District of Columbia,
Guam, Puerto Rico, Australia, Austria, Canada, Denmark, Finland, Germany, Ireland, Italy, New Zealand, Norway,
Spain, Sweden, Switzerland and the United Kingdom as of January 28, 2006:
United States
Number
of Stores
Alabama .............................................................. 58
Alaska ............................................................... 3
Arizona .............................................................. 71
Arkansas ............................................................. 27
California ............................................................. 388
Colorado ............................................................. 52
Connecticut ........................................................... 45
Delaware ............................................................. 16
District of Columbia ..................................................... 2
Florida ............................................................... 230
Georgia .............................................................. 104
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