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Last night we heard the sad news that yet another of the UK’s big High Street brands was forced into administration. HMV has appointed Deloitte to handle things from now on in, and the temporarily good news is that all 239 stores across the UK and Ireland will stay open, for now.
HMV employs about 4,350 people across all its outlets, which now look in serious jeopardy. Deloitte is hoping that it’ll be able to seek a buyer for the 92-year-old business, but considering HMV’s position has pretty much been untenable for the best part of a year, I’m not sure anyone wants that on their books. Hell, not even the music and movie industry could save it.
Bad news for the UK High Street yet again, then, but this shouldn’t come as a surprise as first Comet, then Jessops crashed under the strain of the economic downturn. It seems the naysayers were right when they cast HMV’s month-long 25-per-cent-off sale as the writing on the wall. The only bright side I can possibly see out of this mess is that you might be able to grab yourself a bargain or two as HMV tries to offload stock, but that’s not exactly comforting to the 4,350 people staring down the barrel of unemployment.
With the collapse of the others, and now HMV, it pretty much just leaves Currys/PC World as the only remaining entertainment and electronics retailer on the High Street. How long that’ll remain, we don’t know. Whatever happens, it won’t be long now, if things continue like this, until both UK High Streets and even shopping centres resemble ghost towns. [BBC]
Image credit: Gene Hunt from flickr
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It’s crazy to think that if I walk in my town center now there are no shops that sell movies and records and one GAME store that has barely anything in it. One by one all these big chains are shutting down and pound stores and cafes are taking the place…. we have 3 Subways in like a 10 yard area now lol. Thank god Starbucks shut down though, they’re the worst, I don’t understand why they were ever popular.
It’s a sorry sight when you walk into a town now, most of the shops are shut down. That is the internet age though, I cannot remember the last time I actually bought something from a store other than getting food at Tesco. I always order online…
Just for a minute there I thought you were a towny. But we only have one Subway lol. We have loads of charity shops though. There’s bugger all in my town.
It’s all your fault Sam, you said they would be next and they were. You shall henceforth be known as Cassandra Gibbs. What’s your next prophecy?
Sad to say, but I’ll be amazed if Game survives, that and Waterstones.
I think they’re pretty safe bets. Afterall, hmv sold off waterstones because they were losing money badly, and it was less profitable then hmv and had a faster contracying market, and Game have already gone bust recently. I predict Tesco will go bust. Because why not?
On a serious note, how are WHSmith still around?
Range of products. There’s not much competition when it comes to magazines (at least no major presence chains), and they sell so many different types of stuff, they’ll weather problems more niche shops don’t.
Now that, Sir, is a good question.
Cassamdra?
Think I’m being likened to a hurricane.
Someone Else has gone a bit fancy – she’s a Greek goddess who could see the future:
http://en.wikipedia.org/wiki/Cassandra
Ha, a double edged sword then. Predict the future, then comes in and wipes em all out
“Hell, not even the music and movie industry could save it.”
Yes, because these two industries are well known for rapidly adapting to changing content purchase, delivery and consumption habits…
HMV has failed because despite the selection it is over priced, and even with an online presence, it’s totally disjointed from the rest of the business. You can’t use vouchers purchased online in stores and vice-versa, and the online prices match the high prices in store which mean people just go to Amazon.
The only way HMV could have survived was to slash 25% off everything 12 months ago and make the price reductions permanent – if you’re not competitive, you’re sunk.
PriceWaterhouseCoopers and Deloitte must be getting a lot of work at the moment, being appointed Administrators of the dying companies
Someone always benefits. Capitalism at work.
but, the question is, will they have a flash sale so we can benefit?
I have a feeling, yes. But we’ll keep you posted, of course.
A flash sale? I just bought a 64gb memory card. Damn!
Well, they may do it on CD’s and DVD’s too
I do actually need a bigger SD card for my camera
Looking forward to the liquidation sale
I hate the whole “No gift vouchers accepted” cr@p.
You ALREADY HAVE the money! Surely it should be classed as some form of theft!?
And, yup… I’ve be caught short. Only have about £10-15 in vouchers, but still friggin’ annoying!
You’re an unsecured creditor… that’s how administration sadly works.
Go in, hand gift vouchers, take goods, walk out.
Not sure why everyone doesnt do that.
No, they’re refusing to accept gift vouchers at all. Trying to swap them for stuff is going to get you done for shoplifting.
Just have to make sure there’s a lot of you all with gift vouchers then.
Excellent news! My town was in desperate need of another fried chicken/phone repair/charity shop anyway…
*sigh*
You should see Tunbridge Wells… home of the Coffee Shop!
Didn’t know you where a Giz fan CJ, love it!
LAWTON!?? I suspected that was you ages ago! Now you know that I recycle my Facebook updates as Giz comments…
Oh the shame.
Your secret is safe with me.
Thing is… the *reason* there are so many coffee shops and food shops on high streets and in town centres was always to attract the people that were shopping… if no one goes out to the high street to shop, then they won’t be there to buy overpriced chain coffee or crap food.. If the high street shops die out then it won’t be long before the coffee shops and subways that breed in every town centre go away as well… What then?
I don’t know why we get so sentimental about these things.
HMV failed because they were an arrogant company that did nothing to change their business model to suit how consumers were spending. They weren’t anything special. They were just a generic entertainment retailer, and an expensive one at that.
Their stores were a mess, confusing to shop in and offered little in the way of actual customer service. Like all high streets stores that have big online competition they had 2 choices. Go cheap or specialise and offer the consumer something special. They did neither. They kept prices high and diluted their core purpose with a ridiculous technology line (which was already showing signs of slowing down on the High Street).
Its awful for the 4000-odd people who work there, but it certainly isn’t “sad” to see a company who wouldn’t adapt go the way of the Dodo.
The demise of another chain store isn’t bad for the high street. It could be good. It could open the way for small entertainment retailers to open up without any local competition. Retailers who can offer outstanding customer service, helpful advice, passionate and knowledgeable staff and give consumers something that online purchasing will never be able to give them could do well. People are unwilling to pay premium prices for a service they can get cheaper online (HMV). So offer them a service they can’t get.
These smaller retailers won’t be able to compete with online prices either. They won’t have the selection and prices will be sky high.
And bugger me if you think I’m paying extra to browse in a shop that smells of unwashed hippies, like all these independent stores do.
Fair enough. I would happily pay a bit more to shop somewhere that actually offered customer service, Where I could talk to staff about the games/films/music I enjoyed and who would be able to source things major retailers just wouldn’t.
I remember the old days of HMV when you could talk to staff about music and get on a deck and listen to the latest selection and tunes. Its that kind of service that should be able to thrive on the High Street. Not some generic retailer that offers nothing that Amazon doesn’t for less.
This was a reply of mine on another article but it makes sense here as well.
They have a huge amount of different options. They just need to do something, otherwise they will go quietly into the night with a whimper having not done anything.
Just as an example of “something”, they could modernise there sale model completely…..
1. Get rid of all physical media completely (except video games since that’s not possible yet). It’s massively wasteful and going to be dead in 5 years anyway.
2. Halve the shop space and open download booths around the country.
3. Implement a new digital media system where by people buy media instore or online and save the media onto a HMV Store USB stick. This stick would be able to read and write only when connected in-store or when connected to proprietary software on your computer. In all other situations it would be read-only to make sure the files aren’t so easily pirated. This will allow you to play the media wherever you want as long as you have the usb stick with you.
4. REDUCE PRICES MASSIVELY! Paying £10 for a movie or an album is ridiculous. People consume far more media than ever before. People want to be able to afford to watch loads of movies ands listen to as much new music as they like without it breaking the bank. £1-2 for a movie or an album will all but stop piracy all together and people will be consuming media by the droves.
5. Make it a place people want to be in. Every time I go into an HMV (or the like) it’s incredibly nostalgic. It’s like walking into the past. So once you’ve got all the physical media out of the way your left with a blank slate. The shop needs to be a place where people want to be. Apple knows this, but it can’t be the same as an apple store as people will just see this as a cheap ripoff. It has to be cool in it’s own right. So, for example, get some 4K tv’s in there playing full 4K movies all day (The Hobbit maybe). Put 1080p touchscreens everywhere for people to be able to check out trailers of movies before they buy them and allow customers to buy them right there and then on the screen straight after the trailer. Imagine the tescos robot, payment things but looking much more stylish, with headphones and a beautiful 1080p touchscreen. Make a video game area that has a completely different feel to the rest of the shop. It can have gaming consoles to play on with large soft luxurious sofas and once a month a gaming tournament to make a spectacle to say to people “WE ARE HERE AND WE ARE AWESOME!”.
Yes, all of this is obviously a risk and would cost enormous amounts of money and to be honest it’s probably to late for most of them but they should at least do SOMETHING.
Why do people expect to get everything for nothing these days?! £10 for a movie or album (particularly a movie) is a very good price imo. I still remember 20 years ago when VHS movies were £15 bare bones. To get DVD’s at that price in 2013 is comparitively a bargain. Cinema tickets cost around £8 now, 3 pints on a night out and your into a tenner. People have to make a living somewhere along the line. With movies being ever more grand and expensive to make, then there’s the marketing, packaging, distribution etc. So what if people consume more media, why should that make it cheaper!?
I’m not expecting anything for nothing. I’m expecting a fair price and so is everyone else. It costs less to make a DVD compared to a VHS tape. And it costs nothing to distribute completely digital media via the internet.
It should make it cheaper because people want it to be cheaper. If it isn’t made cheaper then people will simply continue to pirate it and not only because it’s much cheaper but because it’s considerably more convenient in practically every way. People are PAYING to download things llegally and this money could be going to media companies if they weren’t so blinded by their greed.
Things WILL change and anyone who doesn’t will get left behind.
Being on a tech blog I will assume you are aware of this, but distributing digital medial via the internet does not cost “nothing”, bandwith is expensive and media distribution eats up a whole lot of it. Building the interface to download these costs money too. The man power required to mantaining it does too.
While I agree with your initial point, I want to point out that online distribution is far from “costless”.
Yes, I obviously understand that digital distribution doesn’t cost “nothing”. That would be impossible. But if you compare the cost of the download of one movie being distributed by a large company and the cost to make and then write a DVD then cost of the download is negligible in comparison to a physical disk.
It should be cheaper because people want it to be cheaper? Good move. So when you are selling your car or whatever item and advertise it £x because that actually makes sense according to what you paid for the item, the cost of storage, advertising it in the paper and so on, will you accept a lower price just because someone says to you they want it for less? Or maybe when your employer cuts your salary with reasoning of you not actually being worth that much more to them, do you stay at the job and say fair enough, we all need to make a saving?
We’re not talking about a single person selling a single car (or any physical item) though are we. We’re talking about digital media that, clearly, a very large percentage of the population think is over priced. The point that I’m making is that companies and even industries need to move with the market and not against it if they want to survive in the long-term.
I don’t know what the hell your going on about employment for. That has nothing to do with what I’m talking about.
Its called an analogy my friend. The point is you have a physical product (I’m not referring to your DD comment, I’m referring to your DVD comment) that is worth X. Retailer Y has paid X price for this product because thats what it is sold to them at (plus they have to cover rent, distribution, storage, wages and so on) yet you believe that because you don’t think it is worth that price they should just sell it cheaper to match a business that has far less overheads (no store rent, cheaper distribution or even distribution that you pay for in postage). Its not necessarily a viable business model.
My employment thing was along the lines of thinking of yourself as a product. You have a worth in your mind just as HMV has a worth in their mind of a specific DVD. If you go for a job and they offer you less then your perceived worth you say forget it, you don’t lower your price just because someone doesn’t appreciate your worth.
I’m not talking about DVD’s though. Infact I was specifically saying that they should stop selling physical media altogether. I understand why they won’t sell DVD’s/CD’s/Blu-Rays cheaper to compete with online retailers, because they CAN’T compete. Not with that business model anyway. So, they could have changed their business model to sell non-physical media or they could die and they chose to die.
HMV is not a person and is nothing like a person therefore that analogy doesn’t really make any sense. But you’re right that I wouldn’t take a low paid job jus because it’s what a company wants to pay BUT if all companies wanted to pay lower wages then I would be forced to accept that since it is the only viable option. This where media producing companies are at now but instead of accepting the market they are trying to control it by lobbying politicians into making new laws regardless of public opinion. They can do this because they have more money than us. Where does all this money to lobby come from? The shit load of profit they are still making from the film, tv and music industry. They are just greedy. They simply want more and more and more.
Spot the incorrect statement…
a) Movies being ever more grand and expensive to make.
b) Film studios are making record profits year on year (or as you nicely put, a living wage) despite piracy.
c) The costs of producing AV media has contracted significantly (CD/DVD vs Tape/VHS).
d) The prices of physical AV media in 2013 relative to 20 years ago when there was no internet and YouTube etc. are comparatively a bargain.
I’m obviously having a slow day today.. none of them seem incorrect from where I’m sitting…
Hint: it’s d)
Until recently I worked in online retail (Sam, met you and Kat at the Gizmodo party 2 Xmases ago) and whilst I was there, the thing I kept on hearing was Bricks and Mortar retail was tough. The winners were the likes or Primark or the other end of the spectrum, luxury goods (Apple, designer goods etc) Everyone one in between struggles.
I don’t think the high street will completely die. In a way what is happening is a good thing. For far too long, the larger chains have dominated our towns making them identikit. The next wave will be smaller shops, specialising in something niche, or a spin on something established, but without the overheads of running many stores across the country. The writing is on the wall, a lot of online retailers are now using smaller shops as pick up points, and naturally I see this as real threat to Argos and their business model.
Very true, where I live the only large electricals retailers we’ve ever had are Argos and Currys, certainly not the likes of HMV, just lots of supermarkets. We have a good few independant shops, one sells games has been open a few months and seems to be doing well, we have an independant bookstore that is popular and to bring in more trade they bought two shops next door and made them into a coffee shop.
London Camera Exchange is a good example of this too, they’re doing well by providing service, selling second-hand equipment alongside the new stuff and not having too many branches.
The only way for the likes of HMV to compete against Amazon was if they could reduce prices and hence increase volume of sales, and provide a compelling place to shop.
“World change to remain the same”, one of the many reasons capitalism works because of its flexibility, it is good for economy. Having said that, I just remember Assange mentioned “a free market ends up as monopoly unless you force them to be free”
Man: They cut the fibre. Cell’s working.
Bane: For now. How much longer does HMV need?
Man: About 8 minutes.
Bane: Time to go mobile.
Does anyone know the implications of this for Fopp? I’m sure they were bought by HMV years ago, so I guess this means they’re set to go down the tubes now as well. If that’s the case then that would be a shame.