Entertainment software retailer GameStop
But the growth plans of competitor Electronics Boutique
GameStop, majority owned by Barnes & Noble
Numbers like those look like what amounts to a "land grab" in the electronics software business. The moves make sense, in a way, given that the business as a whole can be expected to grow at a solid rate for some time. (The next big boost can likely be expected within two or three years, when the next-generation Sony
What should investors make of this rapid expansion, particularly given that these retailers must compete with each other, as well the likes of Amazon.com
Their clean balance sheets help, but it's nevertheless a difficult question. In order to remain competitive on price and in the marketplace, they must scale their growth. The flip side? Expansion will likely be accompanied by slowing profit growth and slim same-store sales. In short, GameStop and Electronics Boutique may have no choice but to grow or go the way of the neighborhood video arcade.
Talk about the future for specialty gaming retailers on our Retail discussion board.
Motley Fool contributor Dave Marino-Nachison doesn't own any of the companies in this story.