BBC News, 17th February 2013
Morrisons is to buy 49 stores from the failed Blockbuster film rental chain, the supermarket has announced.
The Bradford-based retailer will use the purchase to build a new convenience store franchise, especially in London and the South East.
The firm has previously declared its intention to open 70 convenience stores by the end of this year, primarily in the Greater London area.
To this end, it has already bought up seven stores from the failed camera retailer Jessops, and announced the rebranding of the 12 “M Local” stores that it already owns.
Furthermore, Morrisons has acquired a 100,000 sq ft (9,300 sq m) distribution centre in Feltham, west London.
The firm is expected to announce the inauguration of an online delivery service when it unveils its full-year results on 14 March.
“The convenience market is growing, as more people shop locally and we want to be in a position to take advantage of this.”
Robert Peston, 15th January 2013:
The evidence of past recessions is that economic growth doesn’t resume at any great velocity until unviable and inefficient businesses are put of their misery and excess capacity in various industries is eliminated.
Now, although there has been a fair old number of retailing collapses in the past year or so (according to FRP Advisory, HMV is the 32nd significant retail chain to go into administration in just over a year), there have been many fewer corporate collapses since the financial crisis of 2008 than was predictable on the basis of past economic experience.
As you will know (don’t yawn) if you read this column, this economic malaise has been characterised by many weak businesses being put on life support and turned into the living dead, or (to use what is now a cliche, so sorry) zombies.
This is good for the employees of these companies, for a while at least.
But, many would argue, it is not good for the economy in the long run. Because it preserves excess capacity, in a way that makes it more difficult for new business to grow and thrive, and it also holds back the progress of bigger more successful businesses.
So if HMV’s demise signals a rising incidence of banks and other creditors being more ruthless in putting lame companies out of their misery, that might in a fundamental sense be quite a good thing.
And if those rising corporate mortality rates were real, it would also show that banks were feeling increasingly confident that they have sufficient capital to absorb the consequential losses – which would also be a very positive sign, in that banks would also have sufficient capital to extend necessary credit to viable businesses.