This online firm’s sales have shot up 400 per cent in two years. MCV finds out more from MD Neil Muspratt
Xbite
This fast-growing online firm is branching out into other sectors and services. MCV asks MD Nick Whitehead why
SIMPLY Games is one of the longest-running online retailers in the industry, having been in business for 14 years.
And the past 12 months have been some of the most successful in its entire history. Sales are up 198 per cent year-on-year, and up 400 per cent over two years ago. But the firm has no intention of slowing down and has ambitious plans for 2012. It wants to strengthen relations with publishers and expand its range of games and consoles to include more high-tech products.
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Neil Muspratt has worked in the games industry for over 20 years
Our turnover this year will be circa £35m, so publishers are at last starting to work with us.
Neil Muspratt, Simply Games
“Our expansion over the past 12 months has been quite phenomenal and we are delighted with the progress,” Simply Games MD Neil Muspratt tells MCV. The retail veteran has worked in the industry since 1991 and previously worked as a commercial director at Choices UK. “We have improvements to make
and we’re actively recruiting for technical and marketing positions within the company. But, our most important development for the next 12 months is to build our
relationships with publishers further. “Being an indie is very tough – publishers just don’t want to give you the time of day. Luckily some have over the past year and that’s what has given us the growth. Our turnover this year will be circa £35m, so they are at last starting to work with us. Not all of them are though – and that’s what we need to work on this year.”
Simply Games recognises the stiff competition in games retail and says this is what encourages it to expand further. “Competition seems to increase every year and making a margin also gets more challenging,” Muspratt adds.
“Innovation is the key. We have indentified new markets and developed new routes to existing markets. And so, whilst I think tough times are directly ahead of us, there are still opportunities out there.”
In the space of eight years you’ve gone from a one-man show to having 45 employees. How have you managed to achieve this? We’ve grown quite quickly. We’ve expanded into other product ranges. I’ve tried to keep them related to the games industry, whether it be plush toys, posters or related IT equipment. We’re getting into the toy stuff but it’s so different to video games. We’re designed to handle big quantities of SKUs. We have 13,000 different lines available for sale which is massive for a small indie like us.
You say you’re an IT company. What kind of games-related IT products or services do you offer? In two months’ time we’re launching an IT company that will employ 10 people and will stand on its own two feet. It will do work for Xbite and it will offer services to those who want it whether it’s retail, e-commerce or wholesalers. We offer stock management systems, pricing systems, marketing systems, white label websites and integration between online and internal systems. One of our biggest departments
is IT – nearly a quarter of our staff are in IT. Obviously we’re an online retailer, but we also have logistics, the warehouse, buying team, customer service and accounts.
What kind of game sales have you seen over the past year? Sales have increased for us. We’ve bucked the trend of what the industry is doing. But it’s hard to say whether
Xbite has bucked the industry’s downward trend, says Nick Whitehead
that’s down to online retail growing. We operate as an online retailer in the video games business, which may be dropping 10 per cent, while online is going up 20 per cent. It’s hard to know why sales have increased – it’s probably just more people going online.
How can independent games retail survive?
Specialists will find it harder to do so over time. They’ve got to diversify and have an online presence to survive. The great thing about games is the small size and big value. They don’t take up much room. As you diversify, you can have a £15 toy that can take up the same space as 25 games, which cost £30 a pop. It’s £700 difference. So to diversify is really difficult. That’s why the service we offer allows us to become a one-stop shop, so we can help the indies with that stock issue.