Oh, Monseur le Fopp, you are really spoiling us...

employees not paid this month = sadface

That really sucks. Especially because they must have seen this coming.

if they owe both employees and the bank then they are operating under a very different definition of "profitable" than the one most people i know are familiar with

That "profitable" was for 2006. 2007 has seen stupid expansion, no cashflow, no stock replenishment, closed shops and no business. I don't think their balance sheet will lack red numbers for 07.

so what they meant was "our stores WERE profitable". i guess it was just an honest verb tense mixup.

Thing is: Record shops are in a constant state of 'debit', are they not?

That said, you can carry debt and be a "profitable" business as long as you're servicing said debt with agreed payments.

re: if their store chains are "profitable" then not paying their employees for a month of work is surely against the law?!!

The Fopp shops were profitable pre the acquisition of 67 stores from Music Zone, and since then (February 2007) they have closed over half of these !

More from The Times

Fopp confirms closure of all music stores
http://tinyurl.com/364g58

Other sources questioned whether the chain was profitable and it is thought it may have over-reached itself with the acquisition of 68 Music Zone stores from the administrator in February.

Of those stores it bought it later had to shut some 37 and now has around 81 stores in total.

With the debt of acquiring the Music Zone stores, plus the costs and loss of turnover of closing over half of these post acquisition - has hemorrhaged cash from the business.

In acquiring Music Zone stores from the administrators Deloitte, - Fopp obviously didn't probably analyse the implications of how many stores they could afford to take on. The additional costs of conversion, the financing of the debt, turnover in a difficult retail trading conditions, the working capital required to keep the business going.

They acquired too many stores and just didn't have the finance to continue.

How much did they pay to acquire the Music Zone shops?

Apparently this was financed by short term floating debt, with high interest rates

Why weren't the legal implications of Music Zone stock sorted with lawyers and accountants before they agreed to take over the Music Zone stores?

I am glad I got rid of those vouchers, yet slightly annoyed that they seemed to have put big "vouchers available" signs up in every aisle this week.

I will miss them, and I will miss this thread.

I reckon, "suck it and see" must have been pretty dire for profits, much as I loved it myself.

Would another retailer buy the Fopp chain / brand?

Tesco: Are always looking to expand

WHsmith: Once owned Our Price.

Woolworths: would they buy the Fopp Brand for a knock down price and once again enter the specialist music chain business.

Sir Alan Sugar

if they owe both employees and the bank then they are operating under a very different definition of "profitable" than the one most people i know are familiar with

Onimo is right. Many companies run with high levels of debt at the same time as being profitable. It's not realistic to fund operations with cash. But if they get to a situation when investors not only don't see a positive return in the medium term, but think they may actally lose money, with no prospect of ever getting it back, they'll cut and run.

Funny, I had to rescue this thread from "unanswered questions" before it managed to get going...

PJM - I shall miss your exhortations for people to 'suck it and see' when ever they're not sure about a record. :)

I never used that facility myself. That must mean that I'm still sucking.

So...*cough*...anybody heard anything about a closing down sale?

That never happens

Presumably distributors get their stock back - or some of it.

I remember the Virgin Megastore in Glasgow (beside Central Station) had a closing down sale - there were queues outside it - but that's the last one I remember

It is thought the stores are closed temporarily and some may be re-opened once the administrator has examined the books.

So, who knows (as yet)

It is thought the stores are closed temporarily and some may be re-opened once the administrator has examined the books.

I never reckoned much with the book section myself.

RIP Fopp. The best record store Leamington Spa ever had for sure. This stinks.

-- Ned Trifle II, Thursday, 28 June 2007 22:10 (Yesterday) Link

Amen - the internet will be the only option for me now :(

http://news.bbc.co.uk/1/hi/business/6252300.stm

Analysts say that the chain has been hit by the rise of supermarkets and online retailers selling CDs and DVDs, as well as the surging popularity of downloading music from the internet.

I can't see supermarkets in direct competition with Fopp apart from new release indie albums, which were (I assume) a tiny part of Fopp's sales.

Where else can you pick up all this back catalogue stuff new, assuming you want a physical disk?

supermarkets are not the main competition for fopp.

Where else can you pick up all this back catalogue stuff new, assuming you want a physical disk?

Amazon. Often for the same price.

Internet sales are probably a bigger problem for high street stores than downloading, illegal or otherwise, I should think.

Aye, that's my belief.

supermarkets are not the main competition for fopp.

Indeed. So why so many outlets?

I thought most Amazon marketplace stuff was 2nd hand, or at least the stuff that was comparable with Fopp on price? Also Amazon marketplace = + postage.

Fopp's online shop was a bit of a mess to navigate for most of its life, I think the statement above re online/download sales is true for most retailers except Fopp.

Between Amazon and HMV.co.uk you can get pretty much anything at the price Fopp would have had it, I'd wager. It may be second-hand from a seller, or sourced from Caiman or whatever, or take two weeks, but it's do-able.

but for how long?

I thought most Amazon marketplace stuff was 2nd hand, or at least the stuff that was comparable with Fopp on price? Also Amazon marketplace = + postage.

a lot of it is new + what nick said

Yeah lots is brand new. Same for ebay shops.

In reality there aren't many big players in the UK online CD shopping market in the UK:

big 3 "internet only" e-commerce CD retailers

Amazon (the market leaders)
CD-Wow (limited range)
Play.com

lesser known:

Powerplay direct
Streetsonline / Audiostreet
thehut.com

Specialists retailers that have e-commerce websites:
HMV
Virgin Megastores

major retailers that sell CDs on-line:
Asda
Boots [powered by theHut.com]
WHSmith
Woolworths
Tesco

Sainsburys have stopped selling CDs on-line.

You're forgetting something: www.ebay.co.uk

eBay is an e-commerce platform made up of many sellers

http://music.ebay.co.uk/

Thanks for that link - not sure it'll catch on though.

rofl

Yes, I know, but since we're talking about websites taking business away from high street stores, Ebay is huge.

xpost!

It's cheaper for me to buy cds and lps from the USA, even with their recent hike in postage charges.

Yeah, a few times lately I've ordered stuff from Amazon.com and even with $7 postage it generally works out at only about $20 or so, and current exchange rate makes that a tenner, there or thereabouts.

gotta watch out for customs :(

Not if it's a 'gift' which it will be if the seller has any sense

I got busted a couple of times by customs ordering from CDNow way back when. There's still a limit for gifts, but I think it's quite a bit higher.

caiman have stiffed me twice on that score. it was still cheaper than uk though.

I must say I balked at paying the $7 postage charge US->UK the other day. Monsieur le Fopp's £5 and £6 racks really have spoiled me! Now I even quibble at paying more than $12 (inc postage) on Amazon marketplace. :(

/stingygit

how do you afford to buy so many cds and lps, Brigadier Lethbridge-Pfunkboy?

I'm up for buying and running one of the fopp stores. I reckon I can contribute £300 but I'll need a bit more. Anyone wanta help?

wait actually, I'll sell all my CDs and Records on eBay becuse I wont need a personal collection when i OWN A FOPP.

So I still think I need a couple hundred-thousand from someone. Who fancies it?

Ernst & Young press release:

Fopp Ltd (in Receivership) & Music Zone 2007 Ltd (In Administration)
http://tinyurl.com/yvsx2c