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It’s what it says on the tin, folks. Hot on the heels of Comet and Jessops last week, the BBC is reporting that HMV is going to be the latest of the high street stores to bite the dust, with shares suspended from trading and Deloittes rumoured to be appointed as administrators in the morning. We should have a definitive statement tomorrow AM. It’s a grim start to 2013 for Britain’s retailers.
The news comes after HMV spent this evening in emergency talks with lenders, and I guess if the rumours are true then they haven’t exactly been successful. HMV has 235 shops and 4,000 employees in the UK; what exactly will happen to them, and where people will go in future to buy Now That’s What I Call Music 83 is uncertain. [BBC]
Weathering the Jessops Administration
Comet Admits Defeat and Calls in the Administrators
Game Over For GAME, As It Goes Into Administration
I can’t help but feel it’s all Sam Gibbs’ fault
http://www.gizmodo.co.uk/2013/01/jessops-stores-officially-closed-for-good/#comment-157385
It’s true. He actually tanked the shares. Blame Sam!
LOL.. i cant see DSG going down yet (Currys) they have a massive brand and since re-branding Dixons and pulling all the PC worlds and Currys superstores into one i think they have some time yet.. Thins is what happens once all this goes, where will we go to test new tech, hands on look and feel.. its mental.. Argos next, they should have gone already.. every single item i have ever had from Argos has gone back to it being crap.. even branded stuff.. i think they play football with the stock out back..
I’m genuinely sad about this, if the rumours are true. I actually shop at HMV not-infrequently and though their technology section blows, the DVD range isn’t too bad.
I am too, fair enough they may be a bit over priced compared to Amazon, but you pay a couple of quid extra to go into a shop, talk to people working there, hold the product, test it out, and they’re so local you can “pop-in” anytime if you have a problem, need to take it back, etc, rather than filling in online forms, posting stuff, waiting for emails
The high street is only for Clothes and Phone shops now
Jewellery shops too
My job is safe.
don’t forget coffee.
the coffee market is seriously booming.
That really surprised me. It was one of the first things I cut out when tightening the belt, just because of how easily the repeated little costs add up. I guess people feel like cheering themselves up, and the small cost is psychologically bearable.
I bet primark’s doing a roaring trade too.
yeah i know, i study in london and most of the time my study group meets up in random coffee houses around the city, and literally, at any given time, most of them are close to full capacity. i know that tourists and visitors from other parts of the country definitely play a part in this, but it is quite remarkable, especially nowadays when you have specialty coffee houses popping up every now and then.
but my dad deals in alcohol, particularly wines. and he always says that the business he is in is the greatest. in a recession people want to drink and when the going is good people still want to drink.
i think coffee is kind of like that, it helps to take the edge off and, when it needs to be, it can be something to enjoy.
It really doesn’t surprise me they’ve gone bust. Just that it’s taken this long. The prices in their are ridiculous when compared to online or supermarkets. It’s a sad truth that people just go into the stores to look for things to but later. That’s why everyone used to go in with their bar-code scanning apps.
I used to go in after I’d bought something online,if I had time to waste. I would try and find what I’d bought and check to see how. such dearer it was in there. The record was £110 for a blu-ray box set.
HMV have always been a big fat joke. I am 29 and i have never and would never purchase music. simple. We do not require music stores at all. Next i want to see no more movie stores and game stores. People need to get over the fascination with physical media!
I wholeheartedly disagree with you! Physical media is, in my opinion for many reasons.
1. I can rip it many times in many formats without loss of quality.
2. I can give it to people who also want to listen to/watch it
3. I like the little booklet in cds
4. CD’s are a higher bitrate than most digital downloads (Which matters if you have high end headphones or speakers.
5. Physical media has resale value.
Im interested why you think digital media is better than physical?
*Physical media is better….
I’m stuck on the fence. I like the idea of physical media, for the reasons you’ve mentioned.
I dislike it for one very important reason.
It takes up a lot of space. I’m currently trimming down my library because of a move to a smaller house. It’s a bit of a wrench letting go of books, but square footage is expensive.
^^ This.
I am considering trimming all my CDs down to just the discs as I don’t have the space any more to keep them. It would be a shame as I own over 500 CDs of varying quality and like their presence on the wall but don’t actually use them. It’s all ripped for convenience these days.
Lets wipe out anywhere you don’t shop.
I take it you haven’t invested a great deal of money on a good sound system if you think a 225kb bitrate download sounds as good as a cd – or vinyl for that matter.
dont be a tool, Physical media is about the extra bit of the product, its that booklet, or graphic addition or directors signed something or other, its that little extra that ties you into the universe of heart of the game or film. My Halo4 came with some cool shit in the box that made out to make you dive into the fiction of the game more.. its that nice touch thats worth paying for its the extra bit of art and love and care.. your the kind of guy that would prefer whores over a girl friend.. Physical media i think will get outted as the industry tries to increase its profit margin, still charging you £40 for a game even though its a file and there is no cost for box, art, sales cut, staff, distribution etc.. greed will take away the little extras that make media and entertainment that little more enjoyable..
All these shops going bust has made me think that perhaps a rethink of the high street rental model is in order. Shop units shouild be let out on a proportion of the stores income as rent, rather then a fixed fee. That would encourage smaller shops back in to all the empty units. Pus it would help hmv and such compete with online retailers who don’t have rent to worry about. That way hmv could still be alive even with the pants sales figures, and 4,000 jobs wouldn’t be at risk. Sure they’d have to cut some staff, but not all of them.
That’s how Bluewater operates, but after 5 years if your turnover isn’t at a set level they kick you out. But even with that there are still plenty of empty shops there at the moment.
The biggest issue with HMV is how to compete with Play and Amazon when both are based in Jersey and avoiding tax. If the tax loopholes were fixed, so would the problem.
The tax loop has been closed, hence why Play will no longer have a retail operation come Spring.
Goods bought for less than £15 and imported to the UK from outside the EU – including the Channel Islands – were exempt from VAT under the Low Value Consignment Relief (LVCR).
No more.
The issue isnt just about HMV competing with the defunct LVCR or their general eye-watering prices, it’s about their whole business model being flawed.
I like a wander round HMV whilst the girlfriend is in Topshop; but I never buy anything.
Their games, DVDs, and music are overpriced, and their ‘technology’ offerings were a joke.
The Apple retail stores have proven that having eye-watering prices doesn’t scare people off – at least the prices are the same sky-high level as they are online.
“I like a wander round HMV whilst the girlfriend is in Topshop; but I never buy anything.”
Ha ha, I thought that was just me.
The fact in my local mall the HMV is opposite Topshop can’t be a coincidence….
I’m sorry but this does not make any sense. Shop space is just rented out at market rate. By the same logic it would make more sense to just give them the shop space for free but since the UK works on a capitalist model this is not going to happen.
The problem is that no one is changing there business model. HMV, Jessops, Comet and Blockbuster etc. (and soon to be many more) have not changed in 20 years yet the world is changing ever more rapidly.
Change or die is the new model of the world and I find it crazy that all these tech retailers don’t get it.
Out of interest, how would you recommend they change?
I can’t see a way for them to do it in the dvd / music / games industry without major backing from the distributers, they have no interest in helping out high street chains.
Its a ruthless industry and suffers from the ability of any type of store to offer the most popular products at discounts, which in turn damages the specialist shops.
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. It’s massively wasteful and going to be dead in 5 years anyway.
2. Half 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 compute. 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.
4. REDUCE PRICES MASSIVELY! Paying £10 for a movie or an album is 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 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.
Well it seems, fewer and fewer shops can afford to pay the market rate for rent. There could be a minimum rental payment (say, £500 per month for a normal town), and then a percentage of profits. As it stands, if anyone wants to set up a shop, rent is a huge barrier. My friend and I looked into it. A small town near us, with more than a few empty shops. He wanted to start a coffee shop. The rent for a small, out of the way shop? £22,000. That’s without all the equipment or staff or electricity or water or supplies needed to run the place.
So he isn’t starting a business any time soon. The company leasing the unit won’t be getting any money any time soon (It’s been empty two years!), and there are no new jobs being created.
A flexible, profit based rent system would help resolve this issue I think. Like how eBay takes a cut of every sale, along with a small insertion fee, regardless of whether the item sells. The leasing agency would take a significantly reduced base rent, and then a small cut of profit/sales revenue.
The issue with rent though is that the councils charge the landlord tax on the property all the time it is being used, and with councils increasing the tax levels every year by a pretty big amount. This means that unless the landlord is getting a decent figure, they are better off leaving it empty.
If they were to give a year’s free tax on any unit empty for over 12 months then more small businesses might be willing to take the plunge and see if a physical store would work for them.
The problem is that your assuming all shop space in the uk is public/government owned, when it isn’t. People will let out their properties for how ever much money they want and on whatever pricing structure they want. They don’t care about jobs, they care about money. The retailers also don’t care about jobs, they only care about money. That’s business. That’s capitalism.
People complain of the “identi-kit High Street.” Across the land town centres resemble one another, dominated by the same big retailers, mobile phone shops, 99p stores, supermarkets’ ‘local’ versions; where have all the ‘independent’ shops disappeared to, the specialist and niche retailers, the sole traders? Ah times move on my son, they obviously couldn’t keep up. Don’t mourn their loss, it’s progress.
Why have so many little, independent shops disappeared. Why are the high streets dominated by the same big brands? Because the “market rate” is prohibitive unless you’ve already got money or a proven business model that you can expand. My employer pays £350,000 rent,then there’s the £70,000 business rates on top that.
nooooooooo
https://www.facebook.com/BhamUpdates/posts/492619974121411
absolutely no sympathy whatsoever! This is the same company that thought it was a good idea to charge £30 for the standard battle royale japanese release. And now you fail!
You do realise that people losing their jobs are going to be screwed by this. They are not the ones that set the pricing, and that price probably would be the set value if people like Amazon had to sell in order to do things like pay rent and tax.
If your just talking about the bad management, then fair do’s.
Well, the ones that set the pricing are going to lose their jobs too!
But yeah, I feel sorry for the people that work in there.
well, at least we still have blockbuster!
but seriously, i hope my gtaV pre-order wont be affected.
Not for long. I have a friend that works for them and they are not doing well at all. And to make matters worse their new “solution” is to try and push products on customers constantly from the moment you walk into the shop until the moment they leave.
It’s doomed.
Agreed – do that to me, and I just walk out and make it a point of principle not to go back.
Within five years, the only major shops you will have on the high street will be for items which just don’t make full sense to buy online.
Clothes: yes, online is simple, but it’s a pain if something doesn’t fit
Food : yes, you can do it online, but you miss 50% of the things you actually need, and it’s no substitute for the cattle market in aisle 14
Jewellery : yes you can do it online but the pricey stuff needs to be seen in person
The rest will be 99p stores, Starbucks, and Subways.
And if Starbucks and Subway start offering 99p options, you could say every shop is a 99p shop.
Oh darn, where am I going to hang out now? Usually my hipster friends and I go hang out at our local HMV…you know, we browse and stuff and generally seek out new experiences. Because that’s what music and film are, experiences. Now we’ve no choice but to turn to hard drugs and gin.
My friend works in HMV, he’ll need a haircut and a good bath if he’s going to have any hope of gaining employment elsewhere.
Oh well – Deloittes appointed again!
They administrated the previous company I worked for…
The hourly rate they charge is crazy! – I read somewhere that they could of charged Woolworths around £22,000 per hour!
They can charge pretty much what they like, but it’s generally around the £600-800 per hour mark, and they will have 10 or so people earning this on a company a big as HMV.