News

HMV to close 66 stores

HMV is to close 66 of its stores, making 930 of its staff redundant, as it puts its Oxford Street branch up for sale.

The company’s administrators Deloitte said the decision was made following a review of the stores portfolio.

According to the Guardian, tthe closures include HMV’s flagship Oxford Street branch and administrators will consider offers of £6m–£9m with a deadline of this Friday (8th February) to take on the lease of the building at 130 Oxford Street, London. Hilco, the restructuring specialist, is considering whether it can hold on to the site as part of its plan to run a downsized HMV.

The closures account for 30% of the company’s overall portfolio of 220 UK stores.

Nick Edwards, joint administrator, said: “As part of our ongoing review of HMV’s financial position, we have now completed a review of the store portfolio and have identified 66 loss making stores for closure.  This step has been taken in order to enhance the prospects of securing the business’ future as a going concern. We continue to receive strong support from staff and are extremely grateful to them for their commitment during an understandably difficult period. 

"All other key stakeholders remain very supportive and I continue to be hopeful of securing a future for the restructured business.”

No fixed date has been given for the store closures, although they are likely to take place in the next two months.

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HMV shop staff are some of the best trained, well-informed and helpful on the high street. Especially at their main store on Oxford Street where there is a need for specialist knowledge within the various music genres. It is frankly bonkers to close this site but if it does go ahead, any busy would be a fool not to snap up the redundant staff as a matter of urgency!!

HMV in Oxford Street is always busy, not just with the browsing public, but with people buying stuff.

What does the closure of this store tell us about the future of Waterstones?

I visit their flagship store in Piccadilly at least once a week. The cafe at the top is always packed. That's a good sign, I suppose. But the bookshop itself is very sparsely populated with "customers". I say "customers", but very few are buying. Every week when I visit around lunchtime I count how many people I've seen actually buying at the tills. One or two at the most, and usually none at all. And I'm talking about the whole store and every till. Four floors!
The Christmas period is quite different, of course.

Please could someone with more business savvy than me explain how an empty huge bookstore can survive when a busy CD/DVD shop cannot.

Early news reports said that HMV Oxford Street makes £1m per year profit. Pretty good given the costs of being in Central London. This contrasts to Trocadero which is lost making. Not a surprise as in Trocadero which is now very run down and the store feels very disjoined with all its changes of level, also not very big, compared to many of the other city centre stores around the UK.

Therefore the administrators are taking a short term profit of selling the lease for loss of potential future profit if new owners keep it on.

Looking at the list of closing stores on the BBC website their central area London stores of Trocadero (Piccadilly Circus) and Moorgate are closing. Plus a bit further out Whiteleys (Bayswater) and Croydon Centrale are also closing. Therefore the only central ones left would be Victoria Station and Leadenhall Market both very small.

Is crazy closing the London ones as the Oxford Street store gets loads of tourists buying as even our high street prices are lower than rest of Europe for music and entertainment.

As said above unlike Waterstones, HMV Oxford Street actually has people buying, and in large numbers.

Does HMV still have two stores on Oxford Street? If so, I assume it's the one near Bond Street that's closing, not the main one at Oxford Circus.

Correct me if I'm wrong!

Only one store. The other one closed a while back

The Bond Street HMV was sold to a clothing retailer a few years back, as HMV could get a profit for selling on the lease to them.

At the time they banked the profit as felt they did not need two such large stores only around 5 to 10 minutes walk apart.

The question HMV face with the flagship store on Oxford Street is if you believe the numbers in the Guardian, H&M and other clothing retailers are offering 9 x current annual store profitability (£9m with the store making £1m per year) to take over the lease and store.

Now if you believe that profits for HMV will only fall in future that is a very good deal. However HMV lose their Central London flagship, but does that matter today, especially as more of their products range and sales will move online.

HMV shop staff are some of the best trained, well-informed and helpful on the high street. Especially at their main store on Oxford Street where there is a need for specialist knowledge within the various music genres. It is frankly bonkers to close this site but if it does go ahead, any busy would be a fool not to snap up the redundant staff as a matter of urgency!!

HMV in Oxford Street is always busy, not just with the browsing public, but with people buying stuff.

What does the closure of this store tell us about the future of Waterstones?

I visit their flagship store in Piccadilly at least once a week. The cafe at the top is always packed. That's a good sign, I suppose. But the bookshop itself is very sparsely populated with "customers". I say "customers", but very few are buying. Every week when I visit around lunchtime I count how many people I've seen actually buying at the tills. One or two at the most, and usually none at all. And I'm talking about the whole store and every till. Four floors!
The Christmas period is quite different, of course.

Please could someone with more business savvy than me explain how an empty huge bookstore can survive when a busy CD/DVD shop cannot.

Early news reports said that HMV Oxford Street makes £1m per year profit. Pretty good given the costs of being in Central London. This contrasts to Trocadero which is lost making. Not a surprise as in Trocadero which is now very run down and the store feels very disjoined with all its changes of level, also not very big, compared to many of the other city centre stores around the UK.

Therefore the administrators are taking a short term profit of selling the lease for loss of potential future profit if new owners keep it on.

Looking at the list of closing stores on the BBC website their central area London stores of Trocadero (Piccadilly Circus) and Moorgate are closing. Plus a bit further out Whiteleys (Bayswater) and Croydon Centrale are also closing. Therefore the only central ones left would be Victoria Station and Leadenhall Market both very small.

Is crazy closing the London ones as the Oxford Street store gets loads of tourists buying as even our high street prices are lower than rest of Europe for music and entertainment.

As said above unlike Waterstones, HMV Oxford Street actually has people buying, and in large numbers.

Does HMV still have two stores on Oxford Street? If so, I assume it's the one near Bond Street that's closing, not the main one at Oxford Circus.

Correct me if I'm wrong!

Only one store. The other one closed a while back

The Bond Street HMV was sold to a clothing retailer a few years back, as HMV could get a profit for selling on the lease to them.

At the time they banked the profit as felt they did not need two such large stores only around 5 to 10 minutes walk apart.

The question HMV face with the flagship store on Oxford Street is if you believe the numbers in the Guardian, H&M and other clothing retailers are offering 9 x current annual store profitability (£9m with the store making £1m per year) to take over the lease and store.

Now if you believe that profits for HMV will only fall in future that is a very good deal. However HMV lose their Central London flagship, but does that matter today, especially as more of their products range and sales will move online.