Music shop Zavvi goes into administration
High street music shop Zavvi has been placed into administration.
Zavvi, the former Virgin Megastore chain, called in Ernst & Young after it was crippled by the collapse of Woolworths' Entertainment UK wholesaling division.
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In Bristol there are two Zavvi stores - the old Virgin store in The Mall Galleries, Broadmead, and a new store at Cabot Circus.
Nationally, more than 3,000 jobs are affected.
Ernst & Young has been appointed as administrator of Zavvi UK and liquidator of Zavvi Guernsey, although Zavvi Ireland is not subject to any formal insolvency proceedings.
It said all 125 Zavvi stores in the UK will open as normal on Boxing Day for the post-Christmas sales, and will stay open while a buyer is sought.
Tom Jack, joint administrator, said: "The administrators intend to continue to trade Zavvi UK with a view to selling all or part of its business as a going concern.
"We are grateful for the continued support of all employees during this difficult time and would like to thank everyone at Zavvi for their commitment and hard work as the business continues to trade."
Zavvi employs 2,363 permanent staff and 1,052 temporary staff across the group.
It is the largest independent entertainment retailer in the UK and has 125 stores – 114 in the UK and 11 in Ireland.
Simon Douglas and Steve Peckham, the group's founders, said: "We would like to thank all of our employees for their commitment and support since the launch of Zavvi.
"We have done all that is possible to keep the business trading, but the problems encountered with EUK, and particularly its recent failure, has been too much for the business to cope with."
The EUK distribution business was Zavvi's main supplier and its collapse last month left Zavvi unable to take customer orders.
Ernst & Young said it believes EUK is unlikely to be sold as a going concern, adding that Zavvi had continued to face difficulties in sourcing stock on favourable terms.
Mr Jack said: "Since EUK went into administration, and perhaps before, the impact of problems at EUK on the Zavvi group has been significant.
"Minimal deliveries, no returns and worse trading terms are just some of the areas impacted."
18 Comments
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by Mark, Bristol
Friday, December 26 2008, 1:55AM
“Oh, next imo will be JJB, followed by DSG (rumour that Dyson have stopped supplying Currys (and Argos))..”
by Mark, Bristol
Friday, December 26 2008, 1:47AM
“Jim, bristol
try getting something that isn't mainstream
- shop online. Just like most people who are already buying online, one of the reasons stores like this were struggling already.
Dave, Bristol
Personally i can see Bhs, M&s, Debenhams, wh smiths, either superdrug or boots, currys or comet, dfs due to their excessive advertising, they always seem desperate for customers. and perhaps a large food chain like waetherspoons or harvesters going as people eat out less, obviously none of us wants too see these places go, But i shall be spending more money in these shops. every little helps.
- Smiths wont go, they are safe.
Are you saying that you will spend in the shops that you feel are not safe, purely to help them, even when what you want could be bought cheaper elsewhere?
Lets be honest people, Branson dropped Virgin stores for a reason, he saw that they were not going to be profit making in the near future, so this should have been expected.
All those people who got vouchers for zavvi for xmas, get into the shop and use them ASAP :]”
by Jim, bristol
Thursday, December 25 2008, 10:28AM
“I also Hope they don't go under, because you can rest assured the likes of Tesco etc.. will not stock the more obscure bands and genres of music. try getting something that isn't mainstream”
by Shelly, BRISTOL
Wednesday, December 24 2008, 6:10PM
“Saving? what's that then? Oh yeah that's what you do when you have a well paid job and no kids...!
I'd love to save but with bills increasing all the time the only way I could do that was to sell the kids...Hmmm...Now there's an idea!
The sensible businesses will close stores and concentrate on online sales Not good for staff but cutting overheads will improve shrinking profit margins!”
by Dave, Bristol
Wednesday, December 24 2008, 5:07PM
“i do tend to agree with James on the name, and also why are their Dvd's like £14-£17 when yo ucan get them in woolies, tesco's, Asda, and the like for a good £3 + cheaper? wouldn't it make good buisness sense to at LEAST compete with other reatailers, I know stores are struggling BUT some buisnesses are asking for trouble, look at woolies when wilkinson came along, it didn't compete it just 'FROZE' in time.”