After working at GameStop for so many years, I can already tell you that a lot of the things said here are lies. For one thing, a LOT of bad games slip through and get back to the stores.
Specialty retailer gives us a tour of their $7 million, 182,000 square foot facility in Grapevine, Texas and explains what goes into its refurbishment process.
For the first time ever, GameStop opened its refurbishment center in Grapevine, Texas last week to outside eyes and ears. GameSpot was invited to Texas to get a tour of the facility and to speak with those who run the operation about what exactly goes on in there. We seized the opportunity, and flew to Texas to do just that.
During our time at the center, officially called the Refurbishment Operations Center, ("The ROC" as its employees call it), we got a one-on-one tour of the facility, spoke with executives like GameStop CEO Paul Raines, and learned quite a lot. Below and on the next page you'll find a gallery of photos from the center, some of which we took, and some provided by GameStop.
Facts and Figures
The ROC is a 182,000 square foot facility that opened in 2010, and is located at 2200 William D. Tate Avenue in Grapevine, Texas, just down the road from GameStop's headquarters. And by "just down the road," we mean just 2.3 miles away. The prior refurbishment center was located at GameStop's HQ, directly on top of corporate offices.
The ROC was a $7 million investment, and an expense proposition that made Raines and the rest of the executive team "very nervous." Ultimately, GameStop purchased the facility, and Raines says it affords the company an "unrivaled competitive advantage." In an interview with GameSpot, Raines explained that having a refurbishment center like the one it operates has allowed GameStop to have great success in the pre-owned market where others have tried and failed.
When you trade in a game, console, or peripheral at your local GameStop location, and the sales associate has doubts about the quality of the disc or device, the item is packaged and sent to the center. GameStop charges you a "refurb fee" for this.
Once at the center, the refurbishment process begins. But first, what does refurbishment exactly mean? Or what does it mean to GameStop? According to divisional vice president of refurbishment John Daugherty, "We're looking at repairing it; getting it back to that original factory condition. Not upgrading it, not downgrading it, but getting it back to where it is…you're not just trying to get it working, you're not trying to sell it to a customer and in 30 days or 60 days they have a bad experience with it, because they'll never come back to you again."
Who Works at the ROC?
Games and consoles (and now tablets and iDevices, too) are sorted, cleaned, prepared, and even destroyed at the ROC. To do this, GameStop employs 1,100 associates (divided into two shifts) to get the job done. GameStop says many of the employees are local job recruits who come from varied national origins, including South and Central America, Southeast Asia, and West Africa.
Daugherty said GameStop has never stopped hiring for positions at the ROC, with both hourly and salaried positions always available despite the economic downturn hurting the United States workforce.
"It's so frustrating to me to watch the news and see the stories saying everything's down, there's no jobs. If you are fresh out of high school and looking for your first job, I have an opportunity for you. If you are a degreed engineer looking for an opportunity, there is an opportunity for you here," Daugherty said. "We can grow as fast as we can grow. Our only limit is ourselves."
Quality Assurance is a Big Operation
GameStop stressed it emphasizes quality in the used products it sends out its doors. Of the 1,100 staffers at the center, 85 are dedicated exclusively to quality assurance. GameStop's senior vice president of supply chain and refurbishment Bruce Kelp reiterated this fact again and again, saying GameStop "can't lessen quality" with its refurbishment process. To this end, a quality inspection is conducted at every stage of the refurbishment process. If a disc passes through GameStop's cleaning devices and processes and cannot be salvaged, it is sent to die at the sharp teeth of a low-tech disc-destroying machine. For perspective, more than 17 million discs came through the ROC in 2011, and 3.5 percent (or 595,000) were destroyed. Check out the image on the next page to get an idea about what the disc-destroyer is capable of.
Not every console that comes to the ROC makes it out intact, either. Kelp told us that 15 percent of consoles that come through the center are either dismantled for parts or destroyed. Karp was also clear that destroyed discs and devices are not simply tossed in the trash. They are recycled en masse: in 2011, the refurbishment center recycled more than three million pounds of electronic waste.
Guaranteeing Personal Data is Wiped
In addition to working to ensure that discs and devices that leave the center meet quality standards, GameStop stressed that it makes as sure it can that devices (like consoles, tablets, and iPods) are free of personal data like credit card information or log-in credentials.
"We encourage the consumer to erase. We really think that's the best option. If they forget, and sometimes they do, then we have a deep process that guarantees that," Daugherty said. I'm not going into details, because it's somewhat proprietary, but I can go all the way to the depth of over-writing multiple times, hex-coding code…so we can go to quite a bit of depth to guarantee that personal content can't be retrieved."
It's Not All Refurbishment at the ROC
The ROC is not only used to refurbish used products, it is also a manufacturing center and an idea-incubator. GameStop's new $40 wireless Bluetooth controller for Android games is built at the center. Kelp told us that when GameStop's attempt to find a manufacturing partner for the controller fell through, the company decided to build the devices in-house. Many of the parts come from overseas, but the manufacturing of the controllers is done by a team of assemblers in the facility, at a rate of 300-400 per day. Additionally, GameStop is using the ROC to cook up new ideas. The ROC's research and development division hosts the design of a number of projects, including refurbished PlayStation 3s pre-upgraded with a 1 TB hard drive, and a number of ideas still "behind the curtains."
Why Not Move the Operation to Mexico?
Grapevine, Texas and Mexico are just 500 miles apart. Would GameStop consider moving its refurbishment center to that country, where it could take advantage of lower labor costs? According to Daugherty, GameStop won't do this, because it doesn't need to.
"The bad news is we're competing against the rest of the world, and the rest of the world has lower labor rates," he said. "Here's the good news: we can beat them…because of process control. I've worked at lots of factories and I know how hard it is to provide the controls that we provide here," he said. "It does have a cost to us, which is kind of the behind the scenes thing that the consumer never gets to see. They see what we offer in trade and they see what we sell it for. They don't see the process behind the scenes. If they were more aware of that, they would [say], 'It makes more sense to me now. It makes more sense to me why the prices are what they are.'"
What Happens When Industry Goes Digital?
GameStop's refurbishment center is principally focused on physical products, so when the industry transitions to digital, and such a change is certainly happening, will the center be shut down, and all its employees sent packing? According to Daugherty, GameStop will adapt to survive.
"We have always been aware that digital is coming; it was no secret. It was years and years ago when we said 'This is where the future is coming.' So how do we embrace that? How do we evolve our business into that? How do we say to our consumers 'Whatever way you want to achieve your gaming needs, however you want to make it happen, we're there to facilitate that.' So on my side, if discs fade out, then iDevices come in," he said. "Consumer electronics are not going to go away. So we're always going to be positioning ourselves to meet whatever way consumers are trying to achieve their gaming needs, digital or otherwise, we're going to be a facilitator for that. I think we have that knowledge base because of the years we've built up already, to be able to do that better than anybody else."
While the article certainly is informative there were a few PR quotes from GameStop stuck in there. I don't believe that they are always hiring, I'd have to actually see the statistics. I also don't think that in 10 years they will be operating at the same capacity. There will be less game disks and less disks in need of refurbishment.
Re-soldering a XBOX360 or PS3 chip to the mainboard with proper equipment cost more than those consoles are worth at release. How could they repair a RRoD or YLoD and turn up a profit unless they use "cheap" methods that last 3 months at best.
I hope they can re-surface BluRays or else they might just give up the idea altogether.
I'm not said this is bad thing (it's good to reduce unemployment.)
but believe me this kind of practice that will kill Console games and physical copy (entirely).
Consumers and Retail is a winner (sure,) but Developers, Publishers, also Console manufacturers lost here.
Console industry / Physical copy need those (5) involvements cycle or else they died.
what will happens if you see Crows population is bigger than Rats population??
there will be a huge gap in the near future, and it will be very, very ugly.
So is that why used-game discs are always scratched
Still doesn't explain game-stop buys a disc for $4.00 and then resells the video-game the next day for $19.00 dollars.
Rip off is Rip-Off and Gamespot is no different. :)
@FemalePervert if you CAN why the fuck not?its like if somebody offered you 40$ for a game you're not gonna say "oh ill charge you 30 cuz it's better for you(customer)"
this baffles me to no end
whether or not the information about this facility is exaggerated, this thing is one massive expense. If this is their excuse for their rip off prices, it's only serves to prove how foolish they are. A facility like this running 24/7, testing hardware for hundreds of hours straight, sorting discs through giant industrial sorters, sanitizing them, destroying them with a machine that probably better belongs at a monster truck rally, and a test chamber for environmental stress tests?!
This is just bad business practices. Does it make sense now why they over charge so much? Yes. But only because their reburbishment process is way too damn expensive and unnecessary. Every GameStop store has a machine that can buff out scratches on discs, and the employees sure as shit could test games and consoles to check their working order. All this heavy machinery and extensive testing, not to mention the cost of shipping everything across the country to this one facility and then back out to stores, is far more than needed. I laugh at the quote on this article "unrivaled competitive advantage." This is not your advantage. This is your disadvantage. Streamline the process, make it more efficient and reasonable. This is overkill, plain and simple.
@WCK619 its not about being cost effective its about delivering on a quality product. That said I dont think it is that inefficient. For the associates at gamestop to test and clean every console that is traded in their store would require more ( probably many more) hours to run their operation. The people who work their and refurbish the games/consoles can do it better and faster than in store. Is it the cheapest way possible? absolutely not, but you get what you pay for. If you do not want to pay more for a guaranteed product then do not go to gamestop.
@WCK619 I disagree. If their goal is to turn around used junk on the cheap, then yes, this is unnecessary. However, if their goal is to refurbish products and sell them with the expectation that they'll actually function for a while, it's not. A store associate running a console for five minutes or a few hours does not mean it will continue to function a month or a year after the sale. That's what "quality assurance" is about. It only seems like "bad business practice" to those who are unaware of the last 30 years of progress in quality systems - like, for example, the managers of those Chinese companies that accidentally poison their medicine, toys and dog food.
Yeah you trade in a disk without a case or instructions it goes here because nobody wants to buy it =)
@Diamondsoulz Only if the disc is of low quality. If a disc is scratched up regardless of if it has a case it will go here to be fixed. A disc doesn't need to go here just because it is without a case.
gamestops used games are refurbished?
news to me
i thought gamestop went out of their way to make sure all their used games came without box art
Interesting read as I never have seen what a refurbishment center looks like and the photos tell me alot.
Most games are sold back in the same store, 80% apparently, they don't go to get refurbished. This is just a bunch of PR bs to make us think their insane reselling prices are motivated.
They don't spend a dime on most games, they buy them for 15$ and resell them for 50$, even more. Seriously, who pays 55$ for a used game? Who is so cheap that they buy used just to save a few $? Somebody must be, otherwise they wouldn't have these ridiculous prices.
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dude if the option is where WHY would you not save a few bucks?
tho if there's a new one and they can't manage to get a few more $ then they're just poor
@Daian I work at gamestop, have been for 5 months now, and when we take in ANYTHING with a refurb charge it goes into the defective bin, and shipped out at the end of the week.
First of all When I buy a used game at gamestop all the clerk does is go in a drawer full of discs and pick out the disc and take the display package or get another package and put the disc and package together. How can they claim the 60 dollar used game cost is because of repackaging it and shipping it? Its total bullshit....totally...go buy a used gamestop game and youll see what im talking about....
@IanNottinghamX A big reason that a lot of the games are in sleeves and they move it into a case when you buy it is space reasons. They can store way more games in sleeves than they can in cases. Every Gamestop I have been to is generally only a small mall shop sized store that doesn't have room to keep every game in a case behind the counter.
it's important to remember NOT ever console or device goes to the ROC. If the employee has no doubt about the condition of an item it's sold in house without it ever leaving.
Interesting event, and a well-written article. For future reference, quality assurance and quality control are different things. QA is essentially the creation and maintenance of a quality management system, while QC performs specific functions required by that system, like inspections and trending. I doubt (though I could be wrong) that 8% of these employees are in QA, as that number would be on the high side even for industries with regulatory quality requirements, like pharmaceuticals and nuclear reactor components.
Very interesting read. I had no idea how the refurbishment process worked. That building is immense!
Yeah I'm going to call bullshit on this. This is such an obvious PR stunt, desperately trying to justify ridiculous prices. GameStop often sells games and consoles as-is. They aren't shipped across the country to a facility to be extensively tested for hundreds of hours, go through an industrial cleansing machine and stress tested for extreme hot and cold environments, all before being brought back tot he store and put on the shelf.
People who believe this are incredibly gullible. You probably also believe when you go to the hospital there's a diagnostic team of doctors working day and night to cure whatever ails you like in some medical drama show.
@WCK619 I did think the taped up sign of the test chamber was funny in a facility like this.
But Gamestop has been doing a lot of PR stuns recently.
I gotta say, that last pic is genuinely hilarious. One of these is not like the others!
Big industrial machines, hundreds of consoles and disks, then... piece of plain cheap laminated paper slapped to a door with single piece of sticky tack. IMPRESSIVE! Apature Science got nothing on GameStop!
btw. How the F did my post get derailed into a discussion about the moon landing and illuminati?
@WCK619 What a bizarre reaction to this story. I guess you can just say that everything in media is fake and it's hard to prove otherwise. I suppose that you also think that the US faked landing on the moon.
@jakesnakeel @WCK619 The moon landing was faked in order to allow the US to beat the Soviets in the space race. and the whole thing about a gamestop refurbish center is just a excuse to sell games that just came out for $50, after buying it from the consumer for a few dollars. It's all about profit and smoke and mirrors for companies, saying and doing anything to get our money.
@thekazumalord This is why you shouldn't smoke weed.
@stan_boyd Like, duh! I have a deep concern for some people.
@Razer361 I know right, like seriously why was anyone argueing their existence, everyone already knows about the illuminati's plan to release flying tiger monkeys on the worlds population.
@stan_boyd It's funny how this conversation turned into an argument about the existence of flying tiger-monkeys! Well done people focused on the topic at hand! :)
@Mr_Mark_Legion Ha ha, I knew others knew about the flying tiger monkeys, who's making shit up now :P
@thekazumalord lol all you conspiracy people sound the same, you believe lies, but I don't have to prove it to you :P
@stan_boyd I suppose your allowed to believe what ever you want, whether it's the truth or not.
@thekazumalordYou know christians also claim there is proof there god is real, Muslims claim they have proof that the christians are wrong and that they are right, buddhists claim they have proof that their way is the right way etc etc. But you now, none of that proof has proven anything, just like the so called proof that the moon landing is faked proves anything. Like you said faked says it COULD of been not that it was. But moon rocks and moon reflectors show me that the moon landing isn't fake some video of somebody using a fake name isn't gonna change my mind on that.
@stan_boyd no flying tiger monkeys are not real cause you said so, while there is plenty of evidence on the moon, i don't have space nor do i feel like typing it out. watch faked or faked Syfy show, they show how the moonlanding could have been faked. They don't believe it was, but they do prove it's possible it was faked.
@thekazumalord Uh huh, and what makes your theory any more realistic than mine, what actual evidence do you have to prove the moon landing was faked, and what proof do you have that flying tiger monkeys are fake. Thats right, none just the words of other people. So I say flying tiger monkeys are real and that must mean that they are since I said it.
@stan_boyd The moon landing and flying tiger monkeys only exist in one place..your weird dreams.... and no where else.
@thekazumalord I think flying tiger monkeys are as realistic as your theory of the moon landing being faked.
@stan_boyd Your not being serious, your being childish and stupid. Flying tiger monkeys are about as real as the original moon landing...aka not real, moron.
@thekazumalord @maxwell97 @jakesnakeel It wasn't the US government who covered it up, it was the Illuminati, they are hatching plots to take over the world with their secret army of flying tiger monkeys, and when they do we will be forced to pay a tax to the illuminati in the form of blueberry waffles.
@maxwell97 @thekazumalord @jakesnakeel If there's a way for the government to cover something up, they'll do, with out hesitation. Making people who know too much disappear, hiding or changing facts, lie about things like the moon landing... nothing is to low for our country's government. bottom line.
@thekazumalord @jakesnakeel I'm as skeptical of government as they come, but dozens of universities from around the world have published research PROVING that Apollo put down those reflectors. Are you saying that they're all lying to protect a secret of the US government from the 1960's? Because, frankly, that's ridiculous.
@maxwell97 @thekazumalord @jakesnakeel If you wanna be someone who blindly believes whatever the US government tells us, then go for it. I'll continue to believe in facts thank you. I bet you also believe that Roswell incident was just a weather balloon crashing too? Idiots will believe anything. Are the sending up things ino space these days? absolutely, but the original moon landing ? faked due to their project to build a rocket to the moon, was not completely ready at the time. It's sad that some people believe the lies the government tells us...
@thekazumalord @jakesnakeel Um, right. So, how exactly did they put down reflectors that have been used by scientists around the world for laser-ranging the moon? Or bring back moon rocks with three previously undiscovered minerals? Seriously, five minutes on Wikipedia before typing saves a great deal of embarrassment.
@maxwell97 @thekazumalord @jakesnakeel It's not paranoia, it's fact. We weren't ready to send a rocket to the moon so we faked it in order to beat them, it's as simple as that. You show me a company that doesn't do anything it can, including lying in order to get business, and i'll show you the three head purple dragon that lives under my bed..
@WCK619 Yeah I bet they faked all those pictures too. I'm gullible enough to believe that such a place does exist and that a small percentage of used games are sent here to be refurbished.