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back to article Amazon-bashed HMV calls in administrators, seeks buyer

HMV sought insolvency protection last night, becoming the second big name retailer on the battered British High Street to come close to defeat in the first few weeks of 2013. This comes after the music retail giant spent several years struggling to turn its business around as customers have increasingly shifted to shopping …

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Unhappy

Re: It was only a matter of time - poor customer service stinks for co's

Unfortunately, illegal downloading and online/supermarket retailers are only part to blame for closures like HMV. The biggest reason is customer service and lack of innovation. Any shop that is surviving on the high street and doing "well" are the best at delivering what you want. Shops like HMV had the chance around the iPod revolution to buck up their ideas and offer downloads to customers where broadband hadn't quite taken off and they could afford faster DSL or T1 connections to sync a local cache of songs for MP3 players. Sort of booths that existed in the V Shop to browse songs across a whole range of genres, but added nothing else. Again, the innovation and lack of ambition cost them. Didn't HMV have an online MP3 store as well? Where did that go?

To cram shops with endless CDs, DVDs and headphones was not going to sort the problems out. Downsizing, redesigning the stores and removing clutter would of given them a chance. Why have every CD out available when they could of been stored away if not in top 100 and then have a quick ordering service from a booth?

I love the physicality of browsing shops and having CDs to hand. Big retailers like HMV have done nothing to reenforce that habit and defend its position. Obviously poisioned by another CEO from another failed company that just went under.

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Anonymous Coward

Re: It was only a matter of time

Apparently WHSmiths make most of their money through a monopoly on the distribution side of things.

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Thumb Down

Re: It was only a matter of time

This is also a sunset business because the retail of everything they distribute is as well (newspapers, CDs, DVDs, magazines). Retailing these good as well is surely putting all of the eggs in one basket.

WHSmith is a store I really dislike shopping in. Cluttered, overstocked shops with shite customer service.

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FAIL

Re: It was only a matter of time

WH Smiths?

"Would you like a chocolate bar for a pound? Would you like me to stuff your bag with 10 vouchers that you don't need?"

Whenever I'm in there now they look and feel like they might go the way of Woolworths. Feels cheap, disorganised and the whole bar of chocolate + voucher thing doesn't add anything to the experience.

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Gimp

Re: It was only a matter of time

"what do they actually sell that you can't get from a supermarket or Amazon or one of those cheap book outlets"

Retro Gamer magazine. Smiths is the only regular stockist of it as far as I can tell, save from the odd Menzies/Maccoll supplied independent.

I should really get a sub, but I enjoy the excitement of wandering into Smiths and seeing the latest issue on the shelf. Having it dumped on the doormat by the postie just isn't the same.

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Anonymous Coward

Re: It was only a matter of time

My money's on WHSmiths being next

The WHSmiths in my town is actually always jam packed and seems to be doing a roaring business.

I mean, what do they actually sell that you can't get from a supermarket or Amazon

I suspect you could say that about any shop and even Supermarkets & Amazon as they will eventually have to compete with each other.

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Anonymous Coward

Re: It was only a matter of time

My money is on Admiral being next - Lloyds (IIRC) own about half of their company, they aren't going to want to stay invested in a pubco that long. Lloyds have just forced Admiral to re-value their pubs and I know for a fact that many of them will be coming in under the listed value Admiral have.

In other news, I think they're scum and they've just run my local out of business because they can't see that practicaly bankrupting the landlord/landlady through beer tie is not a good thing to do on an otherwise profitable pub.

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Silver badge

Re: It was only a matter of time

"Retro Gamer magazine. "

Tesco. I see it in there all the time.

Ideally you should ask you local newsie to order it for you and buy it there. Support you local traders, they pay taxes (unlike the big boys).

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Anonymous Coward

Re: It was only a matter of time

"The WHSmiths in my town is actually always jam packed and seems to be doing a roaring business."

It packed where I live too. The thing is that the local main post office has moved into the store and about 60-70% of the footfall goes directly in and out of the post office floorspace, and nowhere near Smiths tills.

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Anonymous Coward

Re: It was only a matter of time

I think if I want a copy of a mag or paper to pass the time waiting on a station, even Amazon's delivery times aren't going to help me. Yeah, I could take out a subscription and read it on my ipad, but maybe I just want one copy to look at right now

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Happy

Re: It was only a matter of time

"Tesco. I see it in there all the time."

Wow, must be a regional thing then, I think I saw it in one of the massive Tesco stores once.

"Ideally you should ask you local newsie to order it for you and buy it there"

That's true :-) Use it or Lose it

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Silver badge

Re: It was only a matter of time

A monopoly on the distribution of dead tree newspapers and magazines. I stopped reading dead tree computer magazines when I realised that I was reading things on it that I had read on places like El Reg about 2 months ago.

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Bronze badge

Re: It was only a matter of time

They still have a lot of railway stations and motorway service stations stitched up.

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h3
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Re: It was only a matter of time

WHSmiths are doing quite well. (Stations / Airports) and the fact they have turnover based rents for those shops.

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Unhappy

Another place where you could actually browse effectively lost.

:(

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Anonymous Coward

actually browse

- if you were interested in looking at multiple copies of various top twenties. The magic of record shops fizzled out for me in the early 80s when shrinkwrapping and corporate stock control took over

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Re: actually browse

And could put up with the "music" on 11 blasting out.. I stopped going in when I couldn't think about what I was looking at.

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Anonymous Coward

And browsing was why they died, nobody actually bought anything!

And if i hear one more comment about losing an institution I'll barf - Just like your local post office(s) it's a case of use it or lose it!

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Not much to browse anymore..

In this market the only way to survive is to differentiate. If you can compete on price, then differentiate with knowledge and selection.

I go to Rough Trade in London regularly and it is always thriving. I can often beat their prices online, but the knowledgeable staff and good recommendations mean you can always find something interesting to buy.

HMV used to be good to browse in, the one on Oxford Street still is. The smaller ones, not so. A while back, they removed pretty much all their music back catalogue and most of the DVD back catalogue in favour of selling gadgets. This meant that they offered the same selection of DVDs and CDs as Tesco but at worse prices. Their gadget selection was obviously more expensive than online, and was also limited in scope. Therefore, no reason to go for either market.

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You could browse, but they made paying difficult.

I love browsing and used to buy a lot of CDs from HMV - the only record shop left in my town. A couple of years ago my local shop got rid of the information desk and made each till an information point - and the tellers were all groomed to ask "did you find everything you were looking for?". The result was that each till could be, and often was, taken up with someone "....looking for a DVD for my husband's birthday. It's got John Wayne in it and I think it's a western".

After about the fifth time of standing in a long, stationary queue with a fistful of CDs while three tills were held up by people making queries I gave up with HMV. I mostly buy my CDs, DVDs (and vinyl!) online now and Amazon are happy to let me pay at any time night or day. I won't even go back to HMV for the fire sale because I know that woman will still be looking for the John Wayne film. Once you lose customers you lose them for good.

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Re: Not much to browse anymore..

That should say *can't compete on price*

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Silver badge

Re: You could browse, but they made paying difficult.

Not to mention loyalty cards and trying to upsell insurance on games/shite old DVD's at the counter. Just ring up what I want to buy and let me get on with my Saturday.

I will be sad to see them go, but I won't pretend to scratch my head in puzzlement.

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Silver badge

Re: You could browse, but they made paying difficult.

HMV's £2.95 insurance against breaking headphones seemed reasonable, but now of course it won't be honoured. The lad who served me on a busy Sunday before Christmas seemed a sound individual - hope he and his colleagues do okay in 2013.

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Another place where you could actually browse effectively lost.

I vehemently disagree. My (past and recent) memories of HMV are disorganized tat warehouses, where you can browse all you like, it's just they've sold out of the thing you wanted to buy. Looking for someone in particular from a back catalogue? Good luck even finding the artist.

We put up with this in the 90s, we'd pop along the high street, wandering between Woolworths, HMV and Virgin comparing prices, since usually at least two would be massively overpriced, and you'd hope that one of them was not.

Most recently, I wanted some DVD box sets for Christmas presents - nothing rare, new releases like The Wire, The Killing, Breaking Bad etc. I popped into the HMV at Westfield Stratford - presumably their most recent store. It was tiny, so crammed with people that you couldn't effectively move around, and none of the DVDs I wanted. I spent 30 minutes trying to look for them, and 10 minutes waiting to talk to someone only to be told "If you can't find it, we probably don't have it".

After that, I went home and did what I should have done in the first place - order it from Amazon. Services like Spotify mean I can browse and discover music on my phone whenever I choose, Amazon nearly always has the best price and everything in stock. Shops like HMV are an irrelevance that will disappear along with the box shifters like Currys and Best Buy.

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JDX
Gold badge

Amazon Outlet Stores?

Maybe? Or just more £1 shops?

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Silver badge

Re: Amazon Outlet Stores?

I would like someone like John Lewis to take them over, make them proper gadget & media stores....

I actually use john lewis to browse, then i buy from john lewis online or in store 90% the time I see something I like.

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Anonymous Coward

Re: Amazon Outlet Stores?

actually, the pound shop in our street has a pretty good selection of cds.

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Unhappy

squaring the (vicious) circle

Virgin & Amazon [et al] couldn't compete with the online retailers.

Play.com etc had the Channel Islands VAT loophole closed on it so it couldn't discount by 17.5%.

So we're left with the only "highstreet" presence being a supermarket bulk discounting the latest stock and with little or no back catalogue.

And Amazon/Google, doing their utmost within the legal framework to avoid UK taxes.

Depressing.

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Silver badge

Re: squaring the (vicious) circle

Play was a company started in Jersey, providing useful levels of employment in Jersey. With the loophole closed, they've left and may not be in a rosy situation.

You could readily argue Play was a more innovative and deserving business model than anything like HMV.

The high street became extremely stale, and never offered anything in the way of passion and customer service, so what's the point?

Then, you have parking. Councils have shot themselves in the foot so hard it's unbelievable, by charging AT ALL for parking in town centres - most think "why bother?" when they could go to the out of town store, or sit on their arse at home and wait for it to come - or even buy the DVD or what-have-you in the supermarket when they next do their normal shopping..

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Silver badge

Re: squaring the (vicious) circle

Play.com were still exploiting a loophole. Jersey was permitted to be VAT free on "low value" items so they could sell bundles of flowers and things like that on the mainland. Not for massive warehouses to set up shop, export goods *out* of the EU in bulk and them reimport them back *in* individually so they were considered "low value" and would not incur VAT.

Certainly it was innovative, but it clearly it was also unfair that they could essentially discount by 20% (or pocket some of that) while domestic operators could not.

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Re: squaring the (vicious) circle

There are two approaches to rationing parking (which needs to be rationed as it is usually a limited resource):

i) some councils don't charge for on-street parking (but do for large car parks), but limit parking to one hour or half an hour with no return for a set time (then fine, clamp, tow offenders).

ii) charge a little bit for on-street parking and allow someone to park for as long as they are willing to pay.

Rationing on-street parking is a good thing because it prevents people hogging spaces preventing people parking who just want to pop into a shop.

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Re: squaring the (vicious) circle

iii) Provide adequate parking at a reasonable price, instead of closing off car parks and jacking up the price "to encourage use of alternative methods of transport."

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Re: squaring the (vicious) circle

iv) Make a fast buck by selling off their car parks to one of these "Pay by phone" scalpers who then install APR and double the price.

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Unhappy

Surprised it has lasted this long

When the big chains moved into towns they used their buying power to aggressively undercut the smaller chains and indie record stores (which then nearly all shut down). One shop owner told me that the biggest problem was that Our Price (etc) could get huge reductions on the wholesale price that he simply couldn't negotiate.

Once all the local competition was out of the way the chains raised their prices again and times were good. They had a monopoly. It wasn't so great for music lovers as the local indies staffed by music fas had all gone and you were left with the equivalent of a Tesco for music.

Then along comes Amazon and their ilk that have broken that monopoly. IMO it's remarkable that they have lasted this long in the age of downloads + the fact you can order things online.

So I cannot really get misty eyed about the loss of HMV. I can get misty eyed about all those small retailers who HMV and Our Price put out of business in the 1980's though. Although arguably many wouldn't have survived this far.

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Pint

Re: Surprised it has lasted this long

Spot on Mr C Hill....

Not surprisingly, there's more companies and business models out there running out of tarmac....

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Silver badge

Re: Surprised it has lasted this long

Yep, think about how many independent record shops there were on Park Street in Bristol alone, ten years back.

And then there seemed to be a branch of Fopp on every street in the town... the indys went belly up, Fopp rationalised its stores down to one... ho hum.

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Unhappy

Sad, but...

...I was in our local HMV at the weekend with my eldest son and it was a mess. DVD's and CD's etc just piled in in no apparent order. No room to browse without blocking the aisles and prices that weren't even a little over the odds.

Jessops - I enjoy photography as a bit of a hobby and last year I was after a lens for my Canon. Jessops wanted (online at this) £1,300 for a lens that Amazon wanted £600 for. Other online retailers were in the £700 bracket on average.

Whilst I like to try and support our incumbent businesses they have, for too long, been their own worse enemy.

Many times in our local Comet store (well I say many - the handful I visited) it could be almost impossible to grab the attention of a sales person.

And of course, fundamentally, many of these companies just failed to respond to the online threat quickly enough.

At the very least, they should have tried to emulate the PC World model of order online and collect from your local store.

<Sigh>.

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FAIL

Re: Sad, but...

Have to agree. HMV was always... different when it came to selling goods. You could walk in and find the same item at three different prices, and it was the sticker price that counted. My mind was blown that day.

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Silver badge

Re: Sad, but...

"Jessops wanted (online at this) £1,300 for a lens that Amazon wanted £600 for. Other online retailers were in the £700 bracket on average."

I wonder when all the high street competition is gone what will happen to online prices... hmm.... tricky one...

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Silver badge

Re: Sad, but...

People will do what they did with Amazon - go to the cheapest supplier. If Amazon fails to be the cheapest, you go elsewhere.

Not saying there couldn't be some collusion and price-fixing, but the thing about online sales is that you can't get EVERYONE to sign up to you. If some local guy selling WHATEVER out of his house has a good website and a reasonable price, I'll use him quite happily. In fact, sometimes even in preference to Amazon. I've bought car parts from such people rather than pay garage or online-spares prices (even on "spares price comparison" sites) and never had any real trouble.

People care about receiving the product for a decent price. They're not particularly fussed about a 1-2 day delay (as evidenced by high-street deaths), so long as they get the product, don't get conned, and can find it quickly and easily on your site (and that your site pops up on Google, for instance). If every big-name online store shut down every bricks-n-mortar store, then doubled their prices, we wouldn't use them. It's even easier to move onto "guy who charges the original price, plus £1, to cover his website expenses" than it is to even walk to the shop next door.

Online shopping wiped out the competition by being more convenient and cheaper. If they aren't more convenient (i.e. their prices are high and force you to check several sites for the best deal), and aren't cheaper, the same Darwinian selection will happen to them.

Methinks the tax issues are more likely to raise online prices on Amazon than anything they do themselves.

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Re: Sad, but...

As long as there are multiple online retailers there will still be competition. Jessops were not competing with Amazon when Amazon were half the price.

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Anonymous Coward

Re: Sad, but...[Jessops vs Amazon]

In total contrast to that, I bought a new Nikon D5100 (with 18-105 lens) in December. Compared loads of shops/sites etc and, unbelievably, Jessops were the cheapest - even cheaper than Amazon, Pixmania, etc

I did find it funny when I went to pick it up though (I wanted to pick up from the store to check it was OK) - as the cost of a memory card was UNBELIEVABLE (£80+ for a 32G sansidks 45mb/s compared to the £20 I paid from Amazon) - I noticed that all of the accessories were twice (of not more) the price of other places. Somebody in Jessops management obviously thought it better to compete on cameras and then rake in the money over the accessories - shame that they didn't think people only go in to but a new camera once every few years so this is a limited market. Jessops will be a sad loss.

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Re: Sad, but...

"I wonder when all the high street competition is gone what will happen to online prices... hmm.... tricky one..." - nothing really as they would still have to compete with other online retailers. The highstreet lost its role as setter of prices a long time ago.

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Silver badge

Re: Sad, but...[Jessops vs Amazon]

Well, its the same story in Currys and Maplins... £15 for a plain ol' USB A > B cable?

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@dave 126

£15 is a lot for a cable, but try finding one anywhere else at 3pm on a sunday. It's the same way Halfords make their money.

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Anonymous Coward

Re:try finding one anywhere else at 3pm on a sunday

try the pound shop. where it costs, er, £1. Bit shorter than in maplins but works fine

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Re: Sad, but...

"Jessops - I enjoy photography as a bit of a hobby and last year I was after a lens for my Canon. Jessops wanted (online at this) £1,300 for a lens that Amazon wanted £600 for. Other online retailers were in the £700 bracket on average."

Jessops are about the only dinosaur in the photography world, as asides from Amazon and a few others trying to bite at the pie, most of the companies are small independent shops that offered mail order, and then moved into the internet at the right time (and the right price). Meanwhile Jessops thought they could still sell everything for maybe £30 off the list price, when everywhere else was >£100 discount - if they even got it in stock, I had a lens on order from them ages ago (in a high street branch), they never got any stock of it, nor did they even seem to know that it had been out for a month by the time I cancelled and ordered elsewhere.

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Bronze badge

Re: Re:try finding one anywhere else at 3pm on a sunday

The pound shop don't do hard drives, power supplies and other complex stuff to my knowledge. When I needed a physical copy of Win 7 *that day* it was easier to drive to PCW than try and find an ISO/Download online.

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Silver badge

Amazon is not evil

Just before this turns into a mess of the same comments as were on the BBC site - Amazon is not some evil entity - imagine how many small businesses in the UK still exist because of Amazon marketplace - where it's as easy to buy from a random business as it is from Amazon themselves and not notice it - many of whom have EXCELLENT service (I purchased an 8-port HP gigabit switch, on free delivery.. and it came the next day - this was NOT Amazon, it was from a small UK retailer you'd otherwise never hear of).

Amazon provides these small businesses with a way to reach a huge audience.

HMV is not, and will never be, a "local business". It is in no way independent or special in some way. Just another big national chain with an incompetent few skimming off their collection of pennies.

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