The successful launch of the Nintendo Switch earlier this month is already creating retail shortages and steep markups on the secondary market. Now, major retailer GameStop says it expects those kinds of shortages and nearly instant sell-through of shipments to last throughout 2017 in its more than 7,000 retail stores.
“The demand is incredibly strong for this [Switch] column,” GameStop COO Tony Bartel said in an earnings call yesterday evening. “As soon as we get into our stores, it’s out within hours. We anticipate that we’re going to be chasing supply this entire year.”
CEO Paul Raines said elsewhere in the call that the retailer’s initial shipment of Switch systems sold out in two days and that “multiple replenishments since the launch… have sold out in hours.” Bartel added that “there is tremendous demand for this, and we just don’t know how high it is because every time we get it out in our stores it’s literally gone.”
Beyond the system itself, though, Raines noted that the average Switch buyer at GameStop also bought 5.5 related products (including both Switch games and accessories) along with the system. “They’re picking up anything they can,” Bartel said. The Legend of Zelda: Breath of the Wild, specifically, has an “almost one-to-one attach result,” Bartel said, meaning practically every Switch customer also picks up a copy of the game.
The GameStop executives predicted continued supply issues for the Switch while also acknowledging a recent report that Nintendo is planning to double its production of the system for the upcoming fiscal year—from 8 million units to 16 million units worldwide. Raines said that GameStop was being cautious in projecting the effects of any production increase, partly because it didn’t know how many units would be allocated to its stores. “We really don’t have an aggressive forecast built in here, and we’ve learned with Nintendo through the years not to do that.”
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