WEST COAST, GIANT VIDEO SET TO SPLICE

DAN ALAIMO

PHILADELPHIA -- West Coast Entertainment here, the second largest video retailer in the country, has entered into an agreement to merge with Giant Video Corp., Marion, Ohio. West Coast has more than 500 video specialty stores operating as franchises.

Giant Video is completing purchase agreements with four smaller video chains. With these four chains, Giant Video would have 105 stores, said Ralph Standley 3rd, chairman. Standley said he is interested in buying out West Coast franchisees. "We feel that the merger of West Coast is extremely important in laying the foundation for our becoming a truly formidable, diversified video specialty retailer," Standley said in a press statement.

The deal also would include Game Power Headquarters, a sister company to West Coast, which primarily operates separate video game departments in West Coast stores, said Steven Apple, vice president of communications and new business development for West Coast. The company also operates a stand-alone store under the Game Power Headquarters banner. In 12 West Coast stores that had installed the Game Power Headquarters sections, total game revenues increased an average of 202%, said Apple. Game rental revenues in those stores increased an average of 39%. "What this shows is that, even in a soft period of the game industry, a section that is well-merchandised, with trained staff, good merchandising and marketing, will show an incremental increase in revenues for the parent store," he said. In supermarkets, Apple said, "It seems that this could be a model to use in planning interactive departments."

Consumers want more selection in game rental inventories and better trained personnel. "The challenge is to see if you can capture that entertainment marketplace within the highly trafficked supermarkets," said Apple.