Retailers margins to drop, or customers to pay more. Guess which...
Nintendo isn’t the first company to blame foreign currency depreciation on lower-than-hoped-for financial results, but its reaction is definitely one of the most direct – a raising of the Wii’s cost to retailers. Speaking to GamesIndustry.biz, Nintendo explained that: “Due to the severe and continuing depreciation of the pound, we are, unfortunately, having to raise our trade price to UK retailers of Wii hardware,” with increases in the region of £18 to £20 expected.
The Wii will keep its current £179.99 MSRP, although, of course, as Nintendo points out: “The price that they then offer to consumers is, of course, up to the retailers.” That will either mean retailers having their current margins eaten into considerably, or selling prices for the Wii being raised – I know which one I see happening.
Says Nintendo: “We are only – reluctantly – raising our trade price now to retailers due to unprecedented and sustained depreciation of the pound. This is a problem brought about by extreme currency fluctuations that are a symptom of the global economic situation.” All well and good and arguably only Nintendo, given the still overwhelming desirability of the Wii, could get away with raising its prices at this time, but nonetheless it’s a kick in the teeth for anyone selling Wiis.