Entertainment retailer Blockbuster has fallen into administration, putting over 4,000 jobs at risk, it has been announced today.
Business advisory firm Deloitte has been appointed administrators to the company and taken over the running of the business as it seeks to secure a sale.
The increasing strength of pure-play e-tailers and the growing popularity of streaming and downloading films online has seen the retailer struggle in a fast-evolving market, explained Lee Manning, Joint Administrator and Partner in Deloitte’s Restructuring Services practice.
“In recent years Blockbuster has faced increased competition from, internet based providers along with the shift to digital streaming of movies and games,” he said.
“We are working closely with suppliers and employees to ensure the business has the best possible platform to secure a sale, preserve jobs and generate as much value as possible for all creditors.”
Fears of a crisis on the high street are building due to this latest news as Blockbuster becomes the third retailer within a week to call in administrators, after the collapse of photographic retailer Jessops and entertainment specialist HMV.
HMV also appointed Deloitte yesterday following a hugely difficult trading period as it sought to compete with e-tail giants such as Amazon and it seems that Blockbuster has suffered similar fate.
Nonetheless, Manning said that the company remains hopeful of finding a buyer.
“The core of the business is still profitable and we will continue to trade as normal in both retail and rental whilst we seek a buyer for all or parts of the business as a going concern.
“During this time gift cards and credit acquired through Blockbuster’s trade-in scheme will be honoured towards the purchase of goods.”