UK high-street retail chain HMV has officially moved into administration with Deloitte acting as administrator for the firm’s 239 UK stores.
In a statement released to the BBC HMV said:
“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,” it explained.
“Understand that it is the intention of the administrators, once appointed, to continue to trade whilst they seek a purchaser for the business.”
Retail analyst Neil Saunders added that this “was always inevitable.”
“In the digital era, where 73.4 per cent of music and film are downloaded, HMV’s business model has simply become increasingly irrelevant and unsustainable,” he explained. “Coming hard on the heels of the failure of Comet and Jessops this latest potential administration demonstrates the significant pressure on retailers, many of which are contending with a consumer downturn alongside structural shifts in the sector.”
“The bottom line is that there is no real future for physical retail in the music sector,”
A reported 4500 are set to lose their jobs at the firm should HMV not recover from this latest grim setback.
After Comet’s closure a few weeks ago along with Jessop’s closure of 187 stores the UK retail industry has gone through a mass change in the last twelve months. But so far HMV would be the biggest closure should the end come to pass.