HMV is the latest high street casualty in the UK. The music, DVD and video game retailer is to appoint an administrator, putting around 4,350 jobs at risk.
The company has been in a financial mess for more than a year now; in December share prices plummeted after it warned it could breach bank loan agreements. The retailer announced a month long sale only last week in an attempt to raise money to put a dent in the £176.1 million worth of debt it carries - it appears this has been unsuccessful.
According to the Financial Times, the slip into administration has come about over the last few days due to suppliers, including music labels and film companies, declining to help HMV with any funding to keep the business trading.
HMV's first store was opened in London's Oxford Street in 1921, and it had enjoyed successful times since. However, in recent years it has faced stiff competition from online retailers such as Amazon, digital download services like iTunes, and supermarkets.
Deloitte is currently keeping HMV's 239 stores in the UK and the Republic of Ireland open while assessing the future prospects for the business. It hopes that a buyer will be found.
Speaking to Eurogamer, HMV spokesperson Gennaro Castaldo said:
We don't see this as a final chapter; we still believe there is a future. It might have to be a slightly different future, but one we can still try to achieve, so we're working hard to make that happen.
Because HMV is slipping into administration it means it will no longer accept or sell gift cards. However, there is still some hope that you can get the money back, so don't bin them in a fit of rage just yet.
It's worth noting that HMV has said it will honour all pre-orders, however people should be wary of pre-ordering anything as the company can legally refuse to deliver and refund your item.
We'd like to send our most sincere best wishes to all those who are affected by the news, especially those who may lose their jobs. Hopefully the company can be saved, because if it isn't, the UK high street will lose its last major entertainment specialist.
[source eurogamer.net, via bbc.co.uk]
Comments 9
Such a bad start for the new year for all those people who work there... I have some money on a gift card myself, will see what happens with that.
I was never really a fan of HMV. I found their prices to be more expensive than everywhere else and their stock to be of less variety.
They can't blame the economy for this. People don't buy from HMV because they charge £28 for a blu-ray you can buy online for £8, or charge £45 for games that are £15 online.
I haven't bought a game, film, CD or book from a brick and mortar store for 10 years now. There is no benefit. Online retailers are cheaper for new releases, WAY cheaper for older stuff, and even get pre-orders out to you before the street dates.
What annoys me is that it's never the people in charge that get punished. The guy running HMV now is the guy that used to run Jessops (went into admin last week). The irresponsible banks that have been lending HMV money despite seeing it was doomed will be the first to get paid back too. It's the sales staff and customers that lose out. So many people will have bought/given HMV gift cards for Christmas which are now worthless.
Seems like the number 13 is unlucky after all.
First Jessops last week,now HMV.
It'll be a massive shame if HMV does goes the way of the Dodo,but I'm keeping positive.
Amazon pay zero UK corporation tax. Just sayin
As expected. Ridiculous prices, even when stuff is on sale. Only buy stuff from there when I know it's as cheap as I can get it.
it's not just HMV that has been hit- play.com has been affected as well.
the government has closed a loophole meaning they can't sell DVDs, games VAT free from the channel islands.
I'm a yank, but here in the states we also have chains that charge way too high, compared to what you can find online. Yeah.
I've been living in England for nearly 11 years, and I have only ever bought 1 CD there and that is because I was near one on the day the CD was released. The shops just are over priced and unpleasant to shop in. Whenever I go in one, I wonder around for a bit, take a look at the video games, and walk back out empty handed. (And I used to spend HOURS shopping for music and video games.) HMV just never stores never made me want to stay and look around for a great bargin or rare find.
I am very saddened for all the job loss, especially since there has been so much of it in my area lately. But I won't miss the shop itself.
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