jlrx said:
You can't run a business on 10%
However that is why GameStop came out and said 70% of their profits come from new games (possible also hardware).
What do you think their profit margin is on a new game?
I've no idea to be honest, with so many hands in that pot, it can't be too excessive.
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Retail profit margin on new games is between 40% and 50% . It's going to depend on the size of the business and the size of their orders
It's not that hard to compute.
Do you think those retailers offering 20$ off for pre-order are selling at a loss ? Nope... They still make a profit which means that 60$ game they sold you for 40$ cost them less than 40$, seeing how in most retail business it is 50% I will assume it is the same for games...
Hardware is the exception ( and only consoles), they get their 50% on accessories..
PS3-Xbox360 gap : 1.5 millions and going up in PS3 favor !
PS3-Wii gap : 20 millions and going down !