News - HMV in administration, 4,500 jobs at risk, all vouchers nullified

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Another high street retailer collapses but trading will continue for now.

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Read more.

I'd say it's somewhat insane to see both GAME and HMV enter administration within 6 months of each other.. but both companies enjoyed selling products at stupidly high prices, especially seeing how its far far easier getting most of the products cheaper elsewhere online..

Bad news in general that another big UK employer and tax payer has gone. All we are left with is Amazon who dont pay corporate tax in the UK and have little to no serious competition left in the UK (especially with Play turning itself into just another ebay). That means now that Amazon have corned the market what is to stop them raising prices and taking the UK consumer for everything they've got?

Pretty soon the only thing left on the british high street will be coffee shops, charity shops and a Gregg's!

P.S: Im not supporting HMV's pricing btw it was too high compared to the likes of amazon and they wouldnt even price match to their own website which was rubbish.

Absolutely disgusting, they have had the money for the vouchers, they should still honour them rather than keep the cash for themselves. Especially just after xmas as well.

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Originally Posted by Kanoe

Bad news in general that another big UK employer and tax payer has gone. All we are left with is Amazon who dont pay corporate tax in the UK and have little to no serious competition left in the UK (especially with Play turning itself into just another ebay). That means now that Amazon have corned the market what is to stop them raising prices and taking the UK consumer for everything they've got?

Pretty soon the only thing left on the british high street will be coffee shops, charity shops and a Gregg's!

P.S: Im not supporting HMV's pricing btw it was too high compared to the likes of amazon and they wouldnt even price match to their own website which was rubbish.

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that's because they're the only ones who can actually make a profit...

IMO bricks and mortar for this kind of business is two generations out of date. It's fate was sealed by online sellers such as Amazon a long time ago. In turn they (at least for selling physical CDs/games/DVDs) are superceded by download* - it just takes some time for the full message to filter through sometimes.

* And Amazon for example know this - see their AutoRIP or whatever it's called announcement.

I just hope their is sufficient competition in the download space... We know Valve don't like the current look of it for example!

Bought a new tv just before christmas, of the smart variety. I no longer need a dvd player as I can stream what I want easily with just as good quality from either Netflix or Lovefilm. DVD's need to be about £5 tops now to compete

Supermarkets are also big, and possibly more immediate competition, than e-tailers. They often sell media far cheaper than the likes of HMV and have the advantage of immediate acquisition, unlike Amazon who aren't exactly quick at delivery,

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Originally Posted by Jonj1611

Absolutely disgusting, they have had the money for the vouchers, they should still honour them rather than keep the cash for themselves. Especially just after xmas as well.

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because holders of vouchers are considered debtors, and they are non preferential debtors, once in adminstration they have to treat all debtors the same so can't allow voucher owners to cash in debts whilst other debtors can't. this is something the government could look at to create a law to protect people better from companies going into administration. so if you have vouchers, or have paid a deposit on a sofa, or paid in full for a suit to be made, and the company goes into administration before you get your goods, consumers are covered (businesses would be handled seperately), so for example vouchers are ringfenced or have to be insured in some way that can't be ended/cancelled, so the company can't stop paying for cover and the vouchers aren't covered. so this forms some additional consumer rights such as an amendment to SOGA. in light of a number of companies going bust, and farepack a few years ago, consumers should have some better cover in place

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Originally Posted by Spectoor

but both companies enjoyed selling products at stupidly high prices.

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that's one way to look upon it, but the other is that some competitors enjoyed selling products at stupidly low prices that other companies that had higher costs, such as high street rents/rates and paying full VAT and/or corporation tax couldn't compete with. online stores had the VAT and corporation tax savings on top of lower rents/rates and able to cover an entire country or even countries from a single location, or a few key locations covering wide areas, and supermarkets could sell items at cost price as a loss leader to simultanously bring in custom and screw the competition

i've seen a similar thing happen in other markets, such as in the 90s when companies started selling jeans at £15 a pair when typically they sold for £30 and 501s were £40-45. so that saturated the market with cheap jeans, put a lot of smaller companies out of business, affected profit margins of other big companies, and the jeans market literally died a few months later (remember people wearing cargo pants and anything other than jeans to avoid the jeremy clarkson look - it took years for the denim business to recover) and those fly by night companies went bust. it might be great for some people for a period, but it usually ends up a problem in the long run, and people losing jobs in industries that sometimes never fully recover. the online sales and downloading of content is going to continue to impact on all sorts of retail areas, which will put people out of jobs, not only from the companies going bust, but the knock on effect of a loss of business by suppliers to those businesses, in some cases sending those companies bankrupt themselves, either through loss of business or because one company owes them a debt that's not repaid, forcing them to close down, and things can snowball from there. property companies lose income, councils lose rates, and with large companies that trade stocks, people can lose money through investments which can affect the pensions of people too

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Originally Posted by Unique

that's one way to look upon it, but the other is that some competitors enjoyed selling products at stupidly low prices that other companies that had higher costs, such as high street rents/rates and paying full VAT and/or corporation tax couldn't compete with. online stores had the VAT and corporation tax savings on top of lower rents/rates and able to cover an entire country or even countries from a single location, or a few key locations covering wide areas, and supermarkets could sell items at cost price as a loss leader to simultanously bring in custom and screw the competition

i've seen a similar thing happen in other markets, such as in the 90s when companies started selling jeans at £15 a pair when typically they sold for £30 and 501s were £40-45. so that saturated the market with cheap jeans, put a lot of smaller companies out of business, affected profit margins of other big companies, and the jeans market literally died a few months later (remember people wearing cargo pants and anything other than jeans to avoid the jeremy clarkson look - it took years for the denim business to recover) and those fly by night companies went bust. it might be great for some people for a period, but it usually ends up a problem in the long run, and people losing jobs in industries that sometimes never fully recover. the online sales and downloading of content is going to continue to impact on all sorts of retail areas, which will put people out of jobs, not only from the companies going bust, but the knock on effect of a loss of business by suppliers to those businesses, in some cases sending those companies bankrupt themselves, either through loss of business or because one company owes them a debt that's not repaid, forcing them to close down, and things can snowball from there. property companies lose income, councils lose rates, and with large companies that trade stocks, people can lose money through investments which can affect the pensions of people too

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You might have an argument there, or not...

http://www.philipbeeching.com/2012/0...ll-of-hmv.html

It seems arrogance, overspending and inability to see what's coming did for them...

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Originally Posted by Jonj1611

Absolutely disgusting, they have had the money for the vouchers, they should still honour them rather than keep the cash for themselves. Especially just after xmas as well.

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This was explained on the BBC this morning - voucher holders are creditors of the business, so you join the list (behind HMRC and the banks of course). Problem is that by the time the "big league" creditors have had their slice, there's nothing left for us plebs.
EDIT: oops, just saw "unique" explained in more detail. Agree with what's said in that post that it's high time that these vouchers were protected under some kind of "insurance" type scheme

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Originally Posted by watercooled

Supermarkets are also big, and possibly more immediate competition, than e-tailers. They often sell media far cheaper than the likes of HMV and have the advantage of immediate acquisition, unlike Amazon who aren't exactly quick at delivery,

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Aye, when you can get music/video/games from Tesco etc with your shopping at the same price (or less) as HMV/Game then the writing's on the wall. That said, I've Amazon Prime so haven't had any real issues with delivery.

I don't buy into the idea that downloading killed HMV, instead I'm going to suggest that they failed to find a niche, plus had too many stores (a la GAME). HMV increasingly seemed to focus only on what was in the charts, which meant that they were directly up against the supermarkets - who could pile 'em up and sell 'em cheap more easily.

Oh, and HMV's "loyalty" scheme was a piece of rubbish too (dammit, just realised I had a load of points that'll now be useless) with points that expired and an overly complex method to claim.

Indeed, I saw it on the news myself, you would think, after Game, Comet etc that the government would step in and make sure customers money is protected, I think people need confidence in purchasing, especially with the current climate. Thanks for the comments though, I do agree with what Unique and Crossy said.

Thing I found about HMV was I went in there 3 times in the last couple of weeks and found the prices to be high, and I mean top price high, and the games that people did seem to want, ie chart, they had none in stock, just yesteryears game at release price pricing :/

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Originally Posted by Jonj1611

Absolutely disgusting, they have had the money for the vouchers, they should still honour them rather than keep the cash for themselves. Especially just after xmas as well.

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Although I agree with this statement 100% I'm at a loss as to why anybody would buy vouchers from a company that it has been well reported is in trouble.

I think people who were given them as xmas presents were probably bought well in advance of xmas and it wasn't that well reported on the general news which I am guessing a lot of people buying vouchers would be watching. Also once you buy vouchers you can't take them back for a refund :/

People still buy vouchers as they don't expect a firm to get into trouble after the Christmas rush