Ten HMV stores under threat of closure amid 'extortionate' business rates

Ten HMV stores under threat of closure amid 'extortionate' business rates

HMV plans to close three stores by the end of the month as the retailer enters negotiations with landlords in 10 locations as "extortionate business rates mean that certain locations are no longer viable". 

HMV confirmed stores in Bury St Edmund's, Fopp Glasgow Byres Rd and Nuneaton will close by the end of the month. The retailer, which saw book sales represent around 2% of revenues in 2018, also plans to relocate branches in Lincoln and Plymouth with new stores opening in the cities at the beginning of February.

Kirsty Hurst, the retailer's new head of books who joins the firm from her role as children's category buyer at Foyles, told The Bookseller that HMV is committed to "expanding" its book offer this year. 

She said: "HMV are committed to improving and expanding the book offer nationally throughout 2020. I'm looking forward to working with our staff and the book industry in bringing this change about." 

Responding to reports of more closures, HMV said there are 10 stores where negotiations with landlords are ongoing and the firm is "hopeful" of securing new deals. In a statement, HMV said: " These stores are due to close later this month unless new deals can be agreed.

"The closures are no reflection on our superb staff and where we are not able to come to a new agreement, or relocate staff within the business elsewhere, unfortunately this does mean some of our staff will lose their jobs.

"Landlords are working hard with us to try to come to agreements. However, in some cases the extortionate business rates just mean that certain locations are no longer viable. At present, there are negotiations with landlords over our locations in Birmingham Bullring (this does not impact The HMV Vault opened in Birmingham in October), Leeds Headrow (we opened a new store in St John’s Centre), Bristol Cribbs, Edinburgh Ocean Terminal, Glasgow Braehead, Grimsby, Merryhill, Reading, Sheffield Meadowhall and Worcester."

Meryl Halls, m.d. at the Bookseller's Association said the issue of business rates illustrates that the system needs an "urgent overhaul". 

She said: "The closure of three of HMV’s stores, and the ongoing negotiations with landlords on ten others, is yet another example of the concerning situation on the high street, with a business rates system that urgently needs an overhaul. We very much hope that agreements can be made with landlords, and that the Government will take decisive action to finally address the outdated business rates system, which is compromising the viability and prospects of high streets across the country and gutting the communities who rely on them for commerce and for neighbourhood."

It comes after HMV was sold to Canadian music company Sunrise Records & Entertainment Limited after owner Doug Putman put in a rescue bid to save the retailer in February 2019. Sunrise Records & Entertainment Limited acquired 100 stores across the UK, and 1,487 store and head office employees were transferred as part of the transaction.