Earlier this year HMV announced that it was planning to close 40 of its UK stores by the end of this year
as sales had continued to struggle. With shop visiting down as a whole this year, are we likely to see HMV slowly disappearing from our High Streets forever?
The announcement from HMV to close 40 of its stores came after a slump in sales at Christmas. It is not clear what approach HMV is following when deciding which stores to close. Factors could include: location, profits or not enough people coming through the door. One store in York recently closed after another retailer made an offer for the commercial property, so it may be worth the company selling some commercial properties in desired areas as businesses will be willing to pay higher rates for a better location.
Another blow to the company was during the riots when two of HMV’s commercial properties in Tottenham were targeted by looters. A spokesperson for the company said, “Whilst it’s on-site teams are working hard to normalise matters as quickly as possible, it is likely that it will take a number of days before the stores are in a position to re-open.”
Stephen Robertson, British Retail Consortium Director General said, “Job prospects and cuts, meaning people are shopping less and more retail businesses are failing.” HMV has struggled with sales ever since the trend in music changed from physical to digital as people prefer downloads to compact disks. Other factors which hindered HMV’s sales were online retailers, like Amazon and Play.com and large chain stores, such as supermarkets all selling DVD’s and CD’s at much cheaper prices. Simon Fox, Chief Executive expressed, “The pace of change in the markets in which we operate underlines the urgency with which we must continue to transform this business.”
To add insult to injury when Zavvi closed its shops, HMV bought many of the commercial properties to add to its portfolio. But now it seems HMV has been hit by the Zavvi bug as it continues to struggle with debt repayments to banks.
However, to make sure that HMV doesn’t follow Zavvi’s route, they have developed a new strategy for their current stores. The company is fully aware that the market has changed in recent years, and as such they are focusing more and more on technology as Ewan Pinder, Head of Technology stated, “HMV’s remit has always been about giving its customers the widest-possible access to music, film and games, however they want to discover and enjoy them, so expanding our range of technology products, through which so many of us increasingly consume our entertainment content these days, is actually a very natural fit for us.”
The commercial properties which house HMV stores will have a revamp to enable 25 per cent of the shop floor to be used for technology. The idea is to have a ‘play it, touch it, live it’ theme so people can interact and discover new technologies. They also want to increase their accessories section and have bigger brands in store like Apple and Bose.
It is too early to tell if the new strategy will be a success, but since HMV has been going since 1921 it would be a shame to see it disappear from our High Streets permanently.
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