Blockbuster to close 129 stores

DVD rental firm Blockbuster is to close 129 more stores after it went into administration earlier this month.

It had already given 31 stores notice of closure. The chain has 528 stores and employs 4,190 staff.

Deloitte, the accountancy firm running Blockbusters, said 760 staff are now facing redundancy, but the closures are not taking place immediately.

The administrators have previously said Blockbuster UK would keep trading while it tries to find a buyer.

Joint administrator Lee Manning said: “Having reviewed the portfolio with management, the store closure plan is an inevitable consequence of having to restructure the company to a profitable core which is capable of being sold.

“We would like to thank the company’s employees for their support and professionalism during this difficult time. We are also grateful to the customers for their continued support.”

The administrators said that “a dedicated employee helpline” had been set up, as well as an “employee assistance programme to help those staff facing redundancy find other jobs”.

Expansion planned

The first Blockbuster store in the UK opened in south London in 1989, and the firm has sought to expand its services in recent years, including with a trade-in facility for pre-owned titles.

But the firm’s profits have been hit by the growth of online rental services an, recently, the popularity of streaming films over the internet.

More than 100 Blockbuster UK outlets have closed in the past few years.

Blockbuster in the US went bankrupt in 2011 but was rescued by US pay-TV provider Dish Network in a $ 320m (£200m) deal, which saved hundreds of US stores from closing. The UK arm is also owned by Dish Network and run separately.

Before Blockbuster was bought by Dish Network, there were media reports of ambitious expansion plans, including selling electrical goods such as televisions, mobile phones, and iPods.

But business experts said Blockbuster’s problems were all too similar to those hitting other retailers – a failure to adapt quickly enough to a changing business environment and consumer habits.

Blockbuster’s administration came after music chain HMV and camera-seller Jessops both went into administration earlier this month.

BBC News – Business

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