Videogame publishers speaking at the Entertainment Retailing and Supply Chain Conference in London agree that a standard approach to supply chain management would benefit the entire industry.
At retail, publishers “compete on IP — we compete on titles,” says Mike Kearney, VP European Operations at Electronic Arts. “We don’t compete on [the delivery of] cardboard boxes.”
Kearney says that for starters, EA uses the term “market operations” over “supply chain” to describe the process of retail delivery and inventory management. (The publisher outsources much of these operations to media services provider Arvato.)
Beyond nomenclature, Kearney observes a lack of standards for everything from vendor-managed inventory, in which the distributor monitors a retailer’s inventory and replenishes as needed, to cross-docking, in which distributors load goods from one transport vehicle directly onto another.
Best practices from other home entertainment sectors, such as DVD, have not necessarily carried over into videogames. Gerald Aburrow, VP International Supply Chain Management at Warner Home Video EMEA, says that while the studio now receives DVD inventory data from some retailers every hour, data is still syndicated to Warner’s game publishing unit on a weekly basis.
Aburrow and Kearney, who sat on a videogames panel at the London conference, concurred that there are simply too many supply chains to manage. But conference chairman Devendra Mishra, who moderated the panel, noted that it doesn’t have to be that way: HP, for example, recently “went from 500 supply chains to five.”