The legendary music store uk HMV again bankruptcy

Le mythique disquaire britannique HMV fait à nouveau faillite

Photo: Niklas Hallen Agence France-Presse
HMV had gone bankrupt for the first time in 2013, with already online sales.

The famous music store uk HMV is going to go bankrupt for the second time in nearly six years, the latest victim of a dark year for the physical trade in the United Kingdom and raising fears for the future of the 2,000 jobs the company.

The legendary shops such as HMV, the last specialty channel in the country and the former owners of the record label of the Beatles, are short of money. They have announced their intention to appoint the accountancy firm KPMG as administrator, according to a press release issued on Friday by its owner, the fund Hilco.

The latter will have the task to find potential buyers for the brand, which has 125 stores in the Uk, which will remain for the time to open the time that discussions be held with the suppliers.

Doubled online sales

HMV evokes a slump in Christmas sales, a key period for retailers, as well as a further deterioration in the uk market CD’s and DVD’s that can be felt for many years.

“Even a company very well managed and recognized as HMV can not resist to the wave of challenges faced by uk retailers in the last 12 months in addition to the dramatic changes in the habits of consumers on the market of the entertainment,” says Paul McGowan, ceo of HMV and Hilco.

The leader made particular reference to the success of the platforms of online music Spotify or iTunes, as well as the services of video-on-demand such as Netflix and Amazon Prime.

In the United Kingdom, the sales of online music has surpassed that of in-store sales of CDS and records for the first time in 2012.

A second bankruptcy in five years

HMV had gone bankrupt for the first time in 2013, with already on-line sales, before being purchased in the stride for £ 50 million by the investment fund Hilco, which specialises in the restructuring of firms in difficulty.

Even Hilco has in particular the chain of british diy stores Homebase, which launched a heavy restructuring with the closure of 42 stores, and the possible elimination of 1,500 jobs.

The first store HMV (His Master’s Voice, The Voice of his master) was opened in London in 1921. He belonged to the Gramophone Company, which endowed its logo is legendary, the dog listening to a gramophone.

The company is entered in the history of music in 1962 with the Beatles, who have signed at that time with EMI, the record company which owned HMV until 1996.

The brand is finally a new time constraint to the bankruptcy, not having found the solution to revive despite the control of its operating expenses.

A difficult year for the british trade

“The poor market conditions at Christmas have made their first victim,” notes the analyst Richard Lim, managing director of Retail Economics, quoted by the BBC.

This holiday season, morose does sink a little more of a market for the physical distribution already suffering from the competition of the internet, the cost of rents, the weight of the land tax, or the depression of the consumer due to the blur surrounding the Brexit.

Uk consumer confidence fell to the lowest since five years in December, according to a study recently published by the institute of economic analysis GfK.

In total, almost 150,000 jobs have been cut in the distribution in the United Kingdom by 2018, according to calculations of the agency Press Association (PA).

Among the bankruptcies that are emblematic of the year, are the specialist clothing Calvetron, the british branch of toy stores Toys “R” Us, shopping for electronic products Maplin or even stores hard discount Poundworld.

The big stores have also suffered with the failure of House of Fraser, finally redeemed by the company Sports Direct, while Marks and Spencer and Debenhams have announced closures of facilities.

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