The Press and Journal (Aberdeen and Aberdeenshire)
Blockbuster back in administration
Retail: Latest hurdle puts 2,000 jobs in jeopardy
About 2,000 jobs are at risk after the new owner of Blockbuster Entertainmentsaid it wasputting the DVD and computer games rental chain into administration for the second time this year because of tough trading.
Private equity group Gordon Brothers Europe said 32 jobs would be cut at the chain’s Uxbridge headquarters, while 264 stores are at risk as a buyer is sought.
The chain plunged into administration in January, before being bought by Gordon Brothers in March. At the time of its initial collapse, the group had 528 stores in the UKemploying 4,190 staff.
Gordon Brothers said its
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turnaround attempts for the historically loss-making company coincided with a patch of poor trading across rental and retail sales.
It said stores would con- tinue trading butsomemay need to close if a buyer could not be found.
Blockbuster has been hit hard by intense competition from supermarkets, as well as the shift from physical rental and sales to online games, music and films.
Gordon Brothers said it tried to turn around the chain by restructuring, investing in marketing and negotiating new deals with landlords.
But it failed to broker a licensing deal with US company Blockbuster LCC, whichownsthe brand, fora new digital platform.
It said efforts would now focus on “giving the company achanceof future survival through a reduced and different business model in the hope that a buyer will be found”.
Frank Morton, chief executive of Gordon Brothers Europe, said: “Since the acquisition, we have worked extremely hard to reignite the Blockbuster brand, make our investment work and put the business on a viable footing.
“Despite our best efforts, we regret that we are now forced to makesomeredundancies and would like to thank any affected employees for their support during the last six months.” while optimism around personal finances was its strongest for six years.
Britain’s housing market is recovering as government- stimulus schemes drive prices higher and boost mortgage approvals.
The survey showed rising utility bills were the only mainconcernto increaseon the prior quarter, and are now the first or secondhighest worry for 31% of UK households, up from 27% during the second quarter.
Chris Morley, Nielsen managing director for UK and Ireland, said: “UK consumers have become more savvy shoppers over the last three years. By shopping differently, they have weathered the storm of rising household costs and falling real-term wages.”