Mass Effect 3 dispute could cost GAME £2.5 million

When Mass Effect 3 launches in the UK a week from today, it won’t be available in the country’s biggest high street gaming retailer, GAME.

It’s been well documented now that this is a result of the retailer’s recent financial troubles, but the absence of one of this year’s biggest titles from one of the industry’s biggest publishers (EA) could only further those issues by about £2.5 million. That’s how much one analyst predicts that GAME will lose out on by not stocking BioWare’s latest.

“Working on the assumption that a decent triple A title sells 0.8m-1m titles in the first few weeks of release in the UK and assuming Game has around 20% share, we calculate that by not stocking Mass Effect 3, Game is potentially missing out on around £6m-£7m of revenues in the UK given the title will retail for £39.99,” Mark Photiades of Singer Capital Markets told The Guardian.

“With new software margins of around 24 per cent this could result in £1.5m-£2m of lost gross profit in the current year. It is also worth noting that margins will suffer as a result of the reward card points being offered in compensation. We estimate this could amount to another £0.3m of forgone gross profit as typically pre-orders account for around 30% of initial sales. So in total there could be £2m-£2.5m of lost UK profit in a year where we are already forecasting losses of £8m.”

With the exception of SSX, GAME will not be stocking any other EA titles in the coming weeks, though this is said to be only a temporary situation. Will the company find its feet again fast enough to stock the next wave of big releases?