Jessops gone into administration...
Discussion
Digga said:
10 Pence Short said:
crankedup said:
Another internet sales victim. Why would people buy a camera from Jessops at 200 quid if they can buy the same thing fifty quid cheaper on-line. Its simply modern shopping that is continuing to kill traditional retail outlets.
I agree, but would add that smartphones have contributed more in Jessops' case, as they have almost singlehandedly replaced consumer spend on point and shoot cameras, and Jessops don't sell 'em.If we look back far enough I'm sure we will also see a classic selling off of the foundations via a sale and leaseback deal of the property assets.
This looks like it was a staggeringly badly run business with the board seemingly hoovering vast levels of cash out of a struggling business with no core foundation.
The fast buck for the board of a sale and leaseback is rarely genuinely beneficial and saddles the business with larger outgoings going forward. Combine that with excessive gearing and any slowdown in revenues can spell disaster.
My gut feeling is that the digital camera revolution is part of the problem but a very handy scapegoat as well.
DonkeyApple said:
Digga said:
10 Pence Short said:
crankedup said:
Another internet sales victim. Why would people buy a camera from Jessops at 200 quid if they can buy the same thing fifty quid cheaper on-line. Its simply modern shopping that is continuing to kill traditional retail outlets.
I agree, but would add that smartphones have contributed more in Jessops' case, as they have almost singlehandedly replaced consumer spend on point and shoot cameras, and Jessops don't sell 'em.If we look back far enough I'm sure we will also see a classic selling off of the foundations via a sale and leaseback deal of the property assets.
This looks like it was a staggeringly badly run business with the board seemingly hoovering vast levels of cash out of a struggling business with no core foundation.
The fast buck for the board of a sale and leaseback is rarely genuinely beneficial and saddles the business with larger outgoings going forward. Combine that with excessive gearing and any slowdown in revenues can spell disaster.
My gut feeling is that the digital camera revolution is part of the problem but a very handy scapegoat as well.
The outright dishonesty in some of these cases is disgraceful. Unfortunately the Insolvency business is allowing very sharp practice to escape notice. The loophole provided by prepackaged Insolvency arrangements need substantially limiting to prevent rip offs from being perpetrated upon the unsuspecting customers and creditors who lose out generally.
As usual the Dti and SFO will fail to act effectively.
Steffan said:
..The outright dishonesty in some of these cases is disgraceful. Unfortunately the Insolvency business is allowing very sharp practice to escape notice. The loophole provided by prepackaged Insolvency arrangements need substantially limiting to prevent rip offs from being perpetrated upon the unsuspecting customers and creditors who lose out generally.
As usual the Dti and SFO will fail to act effectively.
Unsecured creditors get shafted all the time - as a result of actions by dishonest directors but also by Banks/Advisers as you say.As usual the Dti and SFO will fail to act effectively.
But to me Jessops is a classic case of not moving with the times - they should have gone to a dominant web presence, and maybe a few flagship stores.
JL is busily developing their on-line presence and reducing the assortment at stores.
Ozzie Osmond said:
Question: How much longer can HMV stay afloat?
They are struggling to move with the times, like Jessops were. I say this having seen their current 'Blue Cross' sale, with 25% off thousands of products on line and in store. But they somehow think their customers are stupid - by raising prices before the discount such that they are still miles more expensive than the likes of Amazon (CD albums for £13 etc). I despair - I'd like to support HMV, but they make it impossible!Hub said:
Ozzie Osmond said:
Question: How much longer can HMV stay afloat?
They are struggling to move with the times, like Jessops were. I say this having seen their current 'Blue Cross' sale, with 25% off thousands of products on line and in store. But they somehow think their customers are stupid - by raising prices before the discount such that they are still miles more expensive than the likes of Amazon (CD albums for £13 etc). I despair - I'd like to support HMV, but they make it impossible!The board sold off all the prime property assets in a leaseback deal. They then massively over geared to buy Waterstones which they then sold for junk creating a staggering loss. They've since re-financed and still cannot pay their interest.
Another stunning example of asset stripping a company, saddling it with debt that is too large to finance and sucking great chunks of cash out of the business.
Again, business models evolve and change but if you have sold off you core assets for a fast buck and personal reward and then over leveraged the business for more personal reward then you won't be able to change your business when needed.
A very badly run business.
JonRB said:
Doesn't surprise me in the least, I'm afraid.
When I decided to buy my Canon 650D last year, I noticed Jessops online were competitive on price and had a "collect from store" facility, so I reserved it online and popped down to Basingstoke with the printout.
When I got there, the staff were busy helping someone with the photo printing machine. Fair enough, so I hang around for 10 mins and finally get some floppy-haired student type to serve me, who says "oh, yeah, ok. I'll look at that for you" and puts my printout down on the counter and looks rather lost, and another customer grabs him with "could you just quickly..." and he wanders off to serve him instead leaving me standing there. After another 5 or so minutes, and rather annoyed by this time, I loudly tell the guy that I hope that the customer who he's decided to go off and serve spends more than £600 because that's the value of the sale he's just lost, and walked out. I bought it from Amazon instead and it arrived the next day.
Isolated incident, perhaps, but it doesn't reflect well.
I should probably add that a good few years ago when I bought my 350D from Jessops in Camberley they gave superb service.
Oddly enough I had almost exactly the same experience at Jessops Bath store. Like you I took advantage of the deal they had on the 650D using buy and collect, duly turned up at the store and was ignored for a good ten minutes as two staff were helping people print photos and the third member had dissapeared out the back. Unlike you I did wait but had to interrupt one of the staff as he then began to talk to a customer that had just walked in and wanted to print photos. Convinced me never to go back.When I decided to buy my Canon 650D last year, I noticed Jessops online were competitive on price and had a "collect from store" facility, so I reserved it online and popped down to Basingstoke with the printout.
When I got there, the staff were busy helping someone with the photo printing machine. Fair enough, so I hang around for 10 mins and finally get some floppy-haired student type to serve me, who says "oh, yeah, ok. I'll look at that for you" and puts my printout down on the counter and looks rather lost, and another customer grabs him with "could you just quickly..." and he wanders off to serve him instead leaving me standing there. After another 5 or so minutes, and rather annoyed by this time, I loudly tell the guy that I hope that the customer who he's decided to go off and serve spends more than £600 because that's the value of the sale he's just lost, and walked out. I bought it from Amazon instead and it arrived the next day.
Isolated incident, perhaps, but it doesn't reflect well.
I should probably add that a good few years ago when I bought my 350D from Jessops in Camberley they gave superb service.
Hub said:
Ozzie Osmond said:
Question: How much longer can HMV stay afloat?
They are struggling to move with the times, like Jessops were. I say this having seen their current 'Blue Cross' sale, with 25% off thousands of products on line and in store. But they somehow think their customers are stupid - by raising prices before the discount such that they are still miles more expensive than the likes of Amazon (CD albums for £13 etc). I despair - I'd like to support HMV, but they make it impossible!Jessops suppliers have come to a different conclusion and aren't prepared to support the business, they obviously don't care about having somewhere on the High Street where customers can go to have a touch and feel of the cameras on offer before buying cheaper online...
HMV will go down the pan, I'm sure.
The one nearest me used to have films on the top floor, ground floor was music and the basement classical/opera/jazz etc.
A while ago they decided to put all music in the basement. The ground floor is now taken up mostly by small, relatively cheap speaker systems for ipods. there is a small section at the front for the current CD/DVD sale, all cheap stuff no-one wants, which is why its on sale. At the back are the computer games that aren't competitively priced.
The variety in the music selection has dwindled, the basement is small and cramped, so they made the aisles smaller to fit more in, which means its almost impossible to walk past someone browsing, more than 4 or 5 in an aisle gets cramped!
I have vouchers for this and the previous christmas that I'm trying to spend, but its difficult unless you want "the best of" or the latest boy band. They have a better range (to order) online, but you can't use vouchers online, bricks and mortar only.
I'd say Jessops were doing a better job, albeit it not the cheapest around.
Every time I've been there the ground floor is empty - no-one appears to want the speaker systems.
The one nearest me used to have films on the top floor, ground floor was music and the basement classical/opera/jazz etc.
A while ago they decided to put all music in the basement. The ground floor is now taken up mostly by small, relatively cheap speaker systems for ipods. there is a small section at the front for the current CD/DVD sale, all cheap stuff no-one wants, which is why its on sale. At the back are the computer games that aren't competitively priced.
The variety in the music selection has dwindled, the basement is small and cramped, so they made the aisles smaller to fit more in, which means its almost impossible to walk past someone browsing, more than 4 or 5 in an aisle gets cramped!
I have vouchers for this and the previous christmas that I'm trying to spend, but its difficult unless you want "the best of" or the latest boy band. They have a better range (to order) online, but you can't use vouchers online, bricks and mortar only.
I'd say Jessops were doing a better job, albeit it not the cheapest around.
Every time I've been there the ground floor is empty - no-one appears to want the speaker systems.
^ Had a similar experience with HMV, shame as I quite liked visiting the store to pick up a random CD. But I went in recently for The Joshua Tree, nowhere to be found (nor, bizarrely, anything else by U2 - and yes you can mock). All the space had been given over to sound docks, games, and earphones. Given that I bought my last set of earphones online since I wanted to do some research beforehand...
DonkeyApple said:
If we look back far enough I'm sure we will also see a classic selling off of the foundations via a sale and leaseback deal of the property assets.
This no doubt just one of the traits referred to by Nicholas Nasim Taleb as "Soviet-Harvard". I could never get why many of the firms that undertook this in the nineties and noughties ever bothered, other than as a massive "one hit wonder" cashflow boost. However, the trend with the newly-branded MBAs was strong...Digga said:
DonkeyApple said:
If we look back far enough I'm sure we will also see a classic selling off of the foundations via a sale and leaseback deal of the property assets.
This no doubt just one of the traits referred to by Nicholas Nasim Taleb as "Soviet-Harvard". I could never get why many of the firms that undertook this in the nineties and noughties ever bothered, other than as a massive "one hit wonder" cashflow boost. However, the trend with the newly-branded MBAs was strong...The extensive conversion of real assets into debt and running costs has led to many firms just not having the capacity to cope in a downturn. As a child I knew Frank Taylor of TW and he used to chat a fair amount about how he built the business from a plot of land which he built two houses on to what it had become. He once said that corporate debt was the route to making the board rich and the staff unemployed.
DonkeyApple said:
Digga said:
DonkeyApple said:
If we look back far enough I'm sure we will also see a classic selling off of the foundations via a sale and leaseback deal of the property assets.
This no doubt just one of the traits referred to by Nicholas Nasim Taleb as "Soviet-Harvard". I could never get why many of the firms that undertook this in the nineties and noughties ever bothered, other than as a massive "one hit wonder" cashflow boost. However, the trend with the newly-branded MBAs was strong...The extensive conversion of real assets into debt and running costs has led to many firms just not having the capacity to cope in a downturn. As a child I knew Frank Taylor of TW and he used to chat a fair amount about how he built the business from a plot of land which he built two houses on to what it had become. He once said that corporate debt was the route to making the board rich and the staff unemployed.
The get rich quick scam merchants that abound in business today are barrow boys redressed as management consultants out for themselves. I never did like them and never did employ any of them. Ever.
Steffan said:
Very interesting particularly the FT comments.
Talking of the FT, they are suggesting HMV could go into administration imminently. I can't read the article as it's behind the paywall, but certainly the headline is saying that.
HMV set to go into administration
Edited by JonRB on Monday 14th January 20:39
January 14, 2013 7:54 pm
HMV set to go into administration
By Andrea Felsted and Robert Budden
HMV is poised to go into administration as early as Tuesday, after suppliers refused a request for a £300m lifeline for the struggling retailer.
Deloitte, which has been advising HMV’s lending banks, is being lined up as administrator to the chain, putting 4,000 jobs at risk.
The expected administration continues the grim start to the new year for the high street, following the collapse of Jessops, the camera retailer, which closed on Friday, with the loss of 1,400 jobs.
Late last week, HMV asked its suppliers, which include music labels, game makers and film companies, for around £300m in additional financing to pay off its bank debt and fund an overhaul of the company’s business model.
But the proposal has been turned down, raising fears that the company will be forced into administration.
A year ago, suppliers stepped in to support HMV, taking a 5 per cent equity stake in the company to secure its position as the UK’s leading entertainment retailer.
The closure of HMV could strike a damaging blow to the UK retail market for video games, CDs and DVDs. According to Verdict, HMV’s share of the combined music and video market, defined as physical and downloaded products bought on and offline, was 22.2 per cent in 2012.
HMV’s market share and its sales peaked in 2009, following the closure of Woolworths in 2008. Its market share remained steady for the following few years, despite falling sales, as other competitors such as Zavvi fell by the wayside.
HMV warned last month that it was poised to breach its banking covenants, sending its shares down 40 per cent on the day, and putting the future of the entertainment retailer under threat.
The company looked at options, including a Company Voluntary arrangement - a deal with creditors to prevent administration - to shed part of its store base.
Deloitte has been acting for HMV’s lending banks, Royal Bank of Scotland and Lloyds. KPMG has been acting for the company.
Concerns about the future of HMV have intensified in recent days, after the company launched a big promotional sale at the weekend.
HMV’s trade has deteriorated over the past year. The company said in December it was facing a “probable covenant breach at the end of January 2013” and blamed poor sales in the run-up to the crucial Christmas trading period.
Trevor Moore, chief executive of HMV, is the former chief executive of Jessops, while non-executive director David Adams, is the former chairman of Jessops.
JonRB said:
Steffan said:
Very interesting particularly the FT comments.
Talking of the FT, they are suggesting HMV could go into administration imminently. I can't read the article as it's behind the paywall, but certainly the headline is saying that.
[url]HMV set to go into administration|http://www.ft.com/cms/s/0/c4096aee-5e82-11e2-a771-00144feab49a.html[/utl]
What I'd like to know is now that we can only buy bits off the net and now tha play.com have also gone, wtf are we supposed to do when Amazon can't cope or put their prices up!
Do what everyone else is doing:
1) Stream it
2) Buy it from iTunes
3) Buy it from a supermarket
4) Download it some other way off the net
The media harps on about 4) killing the Music / Video industry, but the reality is that consumers now have so many channels through which they can get what they want legally. Amazon saw this coming a mile off with dead tree books hence the big drive to Kindle. Paper based books will always have a place, but make it simple and convenient for people to download to their Kindles et al and just cream off all the margin from electronic sales for very little effort.
1) Stream it
2) Buy it from iTunes
3) Buy it from a supermarket
4) Download it some other way off the net
The media harps on about 4) killing the Music / Video industry, but the reality is that consumers now have so many channels through which they can get what they want legally. Amazon saw this coming a mile off with dead tree books hence the big drive to Kindle. Paper based books will always have a place, but make it simple and convenient for people to download to their Kindles et al and just cream off all the margin from electronic sales for very little effort.
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