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Basically the main reasons are:

1) First hand prices are undercut by all online retailers.
2) Supermarkets have got in on video games, undercut them plus take a large portion of the market.
3) Digital is increasing and hurts them more and more
4) Supermarkets, HMV + CEX have started doing second hand games and do it much much better.
5) Bad mis-management and horrendous overheads.

I expect to see a lot of the shops to shutdown and Gamestop take over.