There have been numerous articles in the last few months over the so-called business zombies of the UK high-street. These are companies that have become reliant on low-financing rates but have had stagnated growth, thus are on the verge of collapse.
HMV in a statement last night announced:
The board regrets to announce that it has been unable to reach a position where it feels able to continue to trade outside of insolvency protection
The music retailer has been trading for 90 years, operators 239 stores and employs around 4,000 people. Is this the complete disappearance of HMV from our high streets? Most likely not, however through administration and restructuring, units can close and debt can be refinanced or rolled over. HMVs entire business model has been eroded through a change of how we get music and films. Partly due to piracy, but in more recent years legal downloads through online stores such as Amazon or digital downloads like Apples iTunes and have left the high-street undercut.
This is only January and already Jessops and HMV have called in the administrators, there are likely to be further casualties in 2013.
According to FRP Advisory, HMV is the 32nd significant retail chain to go into administration in just over a year - BBC
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4,500 jobs at risk at HMV as it calls in administrators after rescue talks fail - Guardian