HMV Canada to close all 102 stores

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HMV Canada to close all 102 stores

Postby radiofan » Sat Jan 28, 2017 5:56 pm

HMV Canada to close all 102 stores

Hollie Shaw | January 27, 2017 6:42 PM ET More from Hollie Shaw | @HollieKShaw

TORONTO • The digital music and movie boom has claimed another bricks and mortar victim, with HMV Canada set to close all of its 102 stores in the coming months after 30 years in business.

The ailing company, which first opened its once-expansive stores in Canada in 1986, was put into receivership in Ontario Superior Court Friday and the majority of its head office staff was laid off.

“The company and major suppliers were unable to reach an agreement, on mutually acceptable terms to sustain HMV’s operations and support a recovery,” said court documents filed Friday on behalf of the company. HMV’s stores in nine Canadian provinces will remain open for several weeks in order to liquidate remaining inventory, the company confirmed Friday. HMV owes its major suppliers, including music labels and media studios, $56 million as of Dec 31.

Before the birth of e-commerce, HMV, much like defunct retailers Tower Records and Sam the Record Man, offered customers a one-stop, big-box style shopping experience with a deeper back catalogue selection than small record stores could offer.

The Canadian unit was an offshoot of HMV’s U.K. operations, where it had opened its first store in 1921. While HMV is still a going concern in Britain, HMV Canada has operated as a separate company since 2011, when it was sold to British retail restructuring specialist Hilco UK for $3.23 million.


Digital music has been around for more than a decade but it only became the primary revenue stream for recorded music globally in 2015, overtaking the physical sales of albums and CDs, according to London-based industry association IFPI. Total industry revenues grew 3.2 per cent in 2015 to US$15 billion, with digital music revenue accounting for 45 per cent of sales worldwide compared with 39 per cent for physical music sales.

In recent years, HMV Canada had reduced its CD and DVD inventory and added more vinyl albums, fan collectibles and apparel in an attempt to make up for sliding music and movie sales. It also closed larger stores and leased smaller retail spaces in order to control costs and maintain its footprint across the country.

But HMV’s sales fell to $214.4 million in fiscal 2015 from $225 million in the prior year, the court filing said, and sales are projected to slide to about $190 million for fiscal 2016. That is just over half of what HMV’s sales were for the year ending April 24, 2010, when it recorded annual sales of $360 million.

As of Nov. 30 the company had assets of $63.9 million and liabilities of $131.8 million. It incurred net losses of about $20 million between fiscal 2013 and 2015, and projects another loss for fiscal 2016, the filings said.

Financial Post

hshaw@nationalpost.com

Twitter.com/HollieKShaw

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Those who danced were thought to be quite insane by those who couldn't hear the music.
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Re: HMV Canada to close all 102 stores

Postby jon » Sat Jan 28, 2017 6:06 pm

They have a very unusual store in West Edmonton Mall. We all know how expensive escalators are to install and maintain, but they have one in their two storey store in the Mall, with the top floor right beside Newcap. It will be interesting to see who replaces them in that space.

Historically, I always found them overpriced. Except when they made a typo on the price tag, like a DVD set available on amazon.ca for $104.95 was intended to be $120.95 at HMV, but was tagged as $20.95. I grabbed it.
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Re: HMV Canada to close all 102 stores

Postby drmusic » Sat Jan 28, 2017 9:13 pm

Am I misremembering or did HMV take over A&A Records and Tapes?
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Re: HMV Canada to close all 102 stores

Postby jon » Sat Jan 28, 2017 10:32 pm

According to Wikipedia, A&A was dissolved after filing for bankruptcy one last time in 1993. All assets, including stores, were sold off to anyone who wanted them. No special mention of HMV.

For those of you who did not make the "Record" pilgrimage to Downtown Toronto in the Sixties, Seventies or Eighties, the home stores of A&A and Sam's were on the same block and featured the largest selections of available records (LPs) of any of the stores in the respective chains. And likely of any other store anywhere in Canada. Prices were also excellent.

I remember in Sam's, each walk up a set of stairs to the next storey mean a trip into more obscure material than the last storey.

At its peak, in 1990, A&A had 260 stores across the country. In January 1991, A&A filed for "protection under the Company Creditors Arrangement Act". A&A actually began as a bookstore at the end of World War II, first selling records in the early 1950s. Sam the Record Man moved into the same block in 1961.
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Re: HMV Canada to close all 102 stores

Postby jon » Mon Apr 03, 2017 5:06 pm

How HMV’s bankruptcy will affect the rest of Canada’s music business
HMV’s closure was inevitable as consumers flocked to streaming music services, who will surely benefit further from the chain’s collapse
Jan 31, 2017
Peter Nowak
Canadian Business

To no one’s surprise, HMV Canada will soon fade into oblivion. The record-store chain has been forced into receivership, which means that all of its 102 stores will close by the end of April.

The only thing unexpected about the news is that it took so long. Globally, digital music revenue overtook physical CDs in 2015, then all physical forms last year. The writing for bricks-and-mortars record stores has long been on the wall.

HMV tried to convert to selling more physical goods such as T-shirts and licensed merchandise – coffee mugs and the like – but it was too little too late. The Canadian wing of the chain owes $39 million to its British owner HUK. HMV Canada hasn’t been profitable since 2013, the company says.

Radio personality Alan Cross has a good summary of what the chain’s closure will likely mean for the Canadian music business.

HMV has historically made up a huge chunk of music sales in Canada so everyone from record labels to musicians will now have to consider whether pressing music onto physical formats is even worthwhile, says Cross. The price of CDs and vinyl may go up as a result:
What if, for example, the Northern Pikes wanted to reissue one of their albums as a special edition. Without HMV, the number of units they could move would be severely limited. Another thought: Canada-centric box sets. Most were sold through HMV. Without them–well, you see the problem. Artists will have to further consider direct-to-fan offerings, rather than place stuff in stores.

Streaming music services including Spotify and Apple Music are likely to be beneficiaries, though. With fewer places to buy music and likely less physical music being pressed, streaming is going to become an even more omnipresent source for listeners.

There’s also the question of independent record stores. Will they benefit from the death of their biggest competitor, or will they also go down with the ship?

The smart bet is probably on the latter. While physical books seem to have successfully held off their electronic counterparts, there’s no evidence that digital music won’t eventually comprise almost the entire market.
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