Bankruptcy for Blockbusters?
March 3, 2009 | Leave a Comment
Another key High Street name, Blockbuster, is the latest casualty of the credit crunch and recession. Whilst, understandably, unwilling to comment, it appears that Blockbusters is exploring bankruptcy.
Edward Woo, Wedbush Morgan Securities, said: “Blockbuster has been facing some liquidity issues for a while now and this is one of the options they have. It’s not a great one.
“I don’t think it’s going to result in a liquidation like Circuit City, but if you’re doing business with them, it’s not a great thing,” he said.
Like many key retail businesses in the current financial crisis (Woolworths being another notable example), Blockbusters has been trying to re-invent itself in order to reduce the negative impact of online dvd and video game sales upon their business. With many online rental schemes available in the U.S and U.K it has become harder to encourage as many customers to come out to choose and return their films when they can now rely on the convenience of a postal rental service at an often lower cost.
Beating businesses down on price is the name of the game for consumers now faced with greater choices…especially during a recession. Let’s hope that Blockbusters find an alternative to bankruptcy as a way forward out of their liquidity issues.
