Why game prices have increased so much in South Africa

It is well known that South Africa’s game prices are directly tied to how well the Rand is doing internationally.

With the Rand hit by both politicking at home and abroad, it’s become clear that prices could once again change.

We sat down with AWX’s Tex Hartog to discuss exactly what causes game prices to increase and decrease in South Africa.

“In some cases where the product is purchased in dollars, it’s been far more difficult for publishers to assist considering the massive devaluation of the rand against that currency for an extended period”, said Hartog.

“Very often, our territory still seen as an emerging market for video gaming, just doesn’t buy the volumes required to assist with a feasible price break.”

Given that you purchase your stock well in advance, how badly will the last few weeks affect South African game prices going forward?

“Well, that depends on when local suppliers have to pay for their product, and if that had to happen over the spike or not.”

“Often, forward cover is purchased that allows for a more stable price point for a period, but this is only functional for a limited period and can also have the inverse effect. If forward cover is bought at the wrong time, even if the rand strengthens, games will still have to be purchased from the publisher at that higher forward cover rate.”

“Gaming prices tend to be stable and gradually increase or decrease, if there is devaluation of the rand for an extended period (a month or two), then gamers should expect to see prices change.”

How will these changes effect everyday South African gamers?

“I think at the end of the day, it’s a difficult situation for all involved.”

“Gamers can only afford games at a certain price point, retailers are expected to match that price point and need to sell a specific volume for the product range to remain viable. Local distributors and publishers have to continually work together and negotiate certain pricing structures so that the product remains feasible for all.”

“Just know that we all want gaming prices to be lower, as that means affordable pricing for gamers, more games can be played and better sales are possible for retailers and distributors.”

Now read: Publishers who are lowering their game prices in South Africa this holiday season