How HMV might make a comeback in high street home - Kevin Buckle

Interesting news this week that HMV had returned to the high street in Canada, seven years after it had left. ​However, it was not quite the triumphant return you might think but simply space being allocated within Toys “R” Us shops which are also owned by HMV’s owner Doug Putman.

HMV is reopening in Toys R Us stores in Canada

However, it was not quite the triumphant return you might think but simply space being allocated within Toys “R” Us shops which are also owned by HMV’s owner Doug Putman.

It was no surprise when Putman bought Toys “R” Us in 2021 as his own background is in the toy business though the deal was just for Canada as those shops had been sold in 2018 to another company after the US parent had filed for bankruptcy.

The idea has met with a mixed reception as Canada’s economy is facing similar struggles to that in the UK and it is not clear that the customers who go to Toys “R” Us have the disposable income to spend on music and music related products.

Even Doug Putman at the time in 2021 said that it was unlikely but not impossible that the two brands might one day be under one roof but clearly he has had a change of heart.

Of course, Mike Ashley has had a similar idea giving space to the computer games and console seller Game in his Sports Direct stores as he owns both businesses and the general feeling has been that that has worked OK.

Certainly the thought was that the Game in Waverley Market based just along from myself at Avalanche would probably close when this happened in the Sports Direct on Princes Street and yet they are still doing well and show no sign of leaving.

HMV are also in the news in the UK saying their profits have doubled and claiming vinyl is the main driving factor behind that. The point made in Canada is that with the families that visit Toys “R” Us the children are too young for vinyl and the parents will have more pressing financial considerations than building a record collection.

From HMV’s viewpoint it is to be hoped that they aren’t relying too much on vinyl as that market will no doubt start to decline at some point and a major contributor to HMV’s downfall before on not one but two occasions was not people streaming music but the dramatic drop in sales of DVDs and Blu-Ray.

Within the music industry the hope is that when vinyl does start to show a downturn it will not be too dramatic and remain that way unlike DVD which went from an initial slow decline to sales dropping off a cliff.

For HMV they want to show they are doing well but not too well or record companies will ask them to return to the terms the rest of us abide by which is paying for stock at the end of the following month it is received.

Currently HMV and indeed FOPP who they own only pay for stock after it is sold so carry no financial risk at all which gives them an unfair advantage over the rest of retail. They argued they needed this deal to survive but are they really still saying now that they can not afford to trade unless they carry on with this arrangement?

I’m not sure Doug Putman would want to be compared with Mike Ashley. Let’s just hope he never buys a football club!