The boss of the Entertainment Retailer’s Association has told Radio 1 that she reckons more HMV stores could as yet be closed by administrator Deloitte, but that she is still hopeful a leaner, fitter company will emerge from the current administration.
As previously reported, since going into administration last month, reps for HMV have announced the closure of 66 loss-making stores in the UK and have confirmed that the company’s Irish shops, shut down last month, will remain closed.
However, most commentators have predicted a more radical downsizing of the HMV business ever since the retail company fell into administration, predicting that at least half of the firm’s 240 stores could close, and that maybe as many as three quarters could be axed in a bid to assure the long-term future of the HMV brand, both on the high street and beyond.
Restructuring firm and HMV Canada owner Hilco remains the favourite to acquire the HMV brand. As a result, Hilco will likely influence how many stores are operated by the all-new HMV Group, and the extent to which other HMV shop units can be sold on to other retailers.
Speaking to Radio 1′s Newsbeat, ERA’s Kim Bayley said: “I think there will definitely be more HMV closures over and above the 66 that have already been announced. [But] everyone in the industry hopes that they come through the other side, and that with a slimmer and leaner organisation HMV can still make a high street presence work”.
Adding that she felt entertainment products still had a place on the high street, she continued: “[Consumers] want to go to stores such as HMV. We’re in danger of having a high street with fewer outlets selling CDs and DVD, which would disenfranchise lots of customers. So, as a trade association, all of our members, including digital members, realise HMV has a very important role to play in the CD and DVD ecosystem”.
Last week Deloitte confirmed that it had signed new trading agreements with the majority of HMV’s suppliers, allowing the retailer to stock new releases. Nick Edwards, Joint Administrator at Deloitte, said: “We are pleased that these agreements are now in place, allowing us to replenish stock and bring in new titles. The support of suppliers over the past few weeks has been significant and these agreements demonstrate their ongoing commitment to supporting HMV”.
Regarding ongoing discussions to rescue the HMV company, he added: “Good progress has been made to date and we have received a positive level of interest in the business. Discussions are progressing with a number of parties interested in both the business as a going concern and individual assets despite the high fixed cost base associated with a store network. Landlords have been generally flexible and supportive and we hope to continue working closely with them to restructure the business and seek to secure its future”.