Blockbuster goes into administration following HMV and Jessops
Just two days after high street store HMV announced that it was going into administration follows the announcement that Blockbusters will also be calling in the administrators.
Blockbuster, who is famed for its long standing DVD rental system, have filed to enter administration after hitting hard times in the UK with a massive change in how we watch movies and TV shows. This means that the chain’s 528 stores may close and some 4,190 staff could face job losses if the company were to not be picked up by a buyer and have a serious shake-up.
The administration will be taken over by accountancy firm Deloitte, who are also dealing with the administration of HMV, who will now take over the day-to-day running of the firm whilst they try to find buyers for the brand and its stores.
During the buying period Blockbuster stores will continue to trade as normal and unlike HMV, any customers who have gift cards and credit acquired through their trade-in scheme will be honoured for the purchase of goods.
In a statement regarding the administration Lee Manning from Deloitte’s Restructuring Services practice states:
“We are working closely with suppliers and employees to ensure the business has the best possible platform to secure a sale, preserve jobs and generate as much value as possible for all creditors,” and followed up stating that “The core of the business is still profitable and we will continue to trade as normal in both retail and rental whilst we seek a buyer for all or parts of the business as a going concern.”
The firm has in recent years fallen in popularity due to the rise in online rental and streaming services from the likes of LOVEFiLM and Netflix. However, with both Netflix and LOVEFiLM continuing to improve their services and get very lucrative streaming exclusives, unfortunately things aren’t looking too great for the humble DVD rental.
It’s a shock to see three major UK high-street brands potentially disappear within such a short period, but with more and more people turning to the internet for their shopping and entertainment needs, companies need to drastically change with the times to keep up.