This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.
Business News HMV Timeline Retail
HMV Canada boss discusses company’s collapse
By Andy Malt | Published on Tuesday 31 January 2017
So, who is to blame for the collapse of HMV Canada? According to CEO Nick Williams, streaming, some of the big labels and studios, and people in general. The Kids, though, they’re alright.
As previously reported, HMV Canada was put into receivership by the Ontario Superior Court on Friday, ordering all 102 of its stores to be wound down by 30 Apr. Around 60 staff were laid off immediately, with others being kept on to facilitate the shutdown.
The Canadian HMV company was acquired by restructuring specialist Hilco from the UK-based HMV Group in 2011, two years before Hilco bought HMV UK as well. The parent company is now one of the creditors, who are collectively owed around $56 million.
In a press release announcing the closure, the company said that “Canada has experienced more significant declines [in CD and DVD sales] in each of the last two years than has been seen in most other major markets”.
Speaking to Billboard, Williams went into more detail about what went wrong. Part of the problem stemmed from restructuring post the 2011 acquisition, he said. A number of larger entertainment firms had not agreed to the new terms negotiated with other suppliers back then.
“We just couldn’t get everybody to commit to the model”, he explains. “The problem is that you need everybody to commit because we can’t buy our content from anywhere else; it has to come from those majors, so we are totally reliant on them providing us with their owned titles. So the offer was not as strong as it had to be for our consumers without some of those studios in it”.
That was then amplified by those declines in physical product sales, he adds: “The last two years have become difficult really for two reasons: one, of course, both the labels and the studios have other avenues to market; and subscription services and streaming services have become more dominant and subsequently have had an impact on the decline of our sales”.
The retailer had hoped to survive those declines by diversifying its product range, Williams added. “We’ve obviously been engineering our model, so to speak”, he said, “so that we can find other ways to bring revenues to the business”.
A big part of that was convincing a new generation of consumers to come through the doors – no mean feat when The Kids are not at all interested in your shiny discs. However, their love of t-shirts did help to slow the march to administration somewhat – and the vinyl revival also helped to keep things rolling for a time.
“The reality is that a younger audience is less into purchasing music and film than the generation ahead of them”, says Williams. “So we had to find a way to get the youngsters back in. Bringing in pop culture items and fashion and things that are relative to popular culture certainly did that job for us”.
Williams also says that he believes that diversification could have worked had the firm’s partners been willing to give HMV more time. “Arguably people had written off the brand many times over and we’ve felt that we’ve always been able to bounce back and provide something that is still relevant to the market”, he said. “Unfortunately, now we’re at a point where we were just not able to convince all of our suppliers and partners to do that”.
