- Music Zone
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Music Zone 
Former type Private Industry Entertainment Retail, Record store Fate Administration Founded Longsight, Manchester (1984) Founder(s) Russ Grainger Defunct 3 January 2007 Headquarters Stockport, Greater Manchester, United Kingdom Number of locations 104 Area served United Kingdom Key people Steve Oliver, Managing Director
Nick Standing, Retail Director
Eren Ozagir, Marketing Director.Products Books
DVDs
Games
Music
T-ShirtsRevenue £70.4m Owner(s) Music Zones Services Limited Employees 1,100[1] Parent Fopp Music Zone was a music retailer in the United Kingdom, formed in Levenshulme in 1984, as a market stall in Longsight, Manchester.
Contents
History
Soon after, Music Zone opened its first permanent shop in Stockport and began to expand in the Manchester region, rebranding itself to Music Zone Trade Direct and positioning itself as a value retailer. In Spring 2005 Music Zone was sold in a management buy-out for £12 million,[2] backed financially by the private equity firm Lloyds Development Capital (LDC), as well as funds from the board of directors. In the twelve months to 31 May 2005, the company made a £4,000 pre-tax loss on sales of £70.4m.[2] Then in early 2006 the company bought 41 outlets from collapsed chain MVC,[3] allowing Music Zone to expand nationwide. All stores were branded to 'Music Zone'. The MVC acquisitions took the estate to 104 stores making the chain the third largest specialist entertainment retailer in the United Kingdom, less than 30 stores behind nearest rival Virgin Megastore.
Financial problems
On 27 December 2006, the Bank of Ireland withdrew its loan and future working capital facilities and decided to recover its debts without notice and with immediate effect.[4]. As a result, on 3 January 2007, Music Zone went into administration with 31 stores across the UK closing two weeks later.[2] The cause of the collapse was attributed to "challenging trading conditions and weak pre-Christmas trading, amid increasing competition and aggressive pricing across the DVD and music market."[5] By 26 January 2007, all stores were closed. Music Zone's Head Office was closed on 30 January. By the time of closure, the company debts totalled ₤31 million.
A closed Music Zone store in Exeter in Devon, August 2007
Fopp
On 5 February 2007, retailer Fopp announced it would be taking over 67 of the remaining stores in addition to some of Music Zone's head office and warehouse facilities.[6] In March 2007, Fopp had difficulties rebuilding supplier contracts, and shut down a great number of the higher maintenance stores. On 29 June 2007, Fopp went into administration, resulting in the closure of all remaining Music Zone shops.[7]
References
- ^ Kollewe, Julia (3 January 2007). "Retailers fall into administration". London: The Guardian. http://www.guardian.co.uk/business/2007/jan/03/retail. Retrieved 12 February 2009.
- ^ a b c Fletcher, Richard (4 January 2007). "Music Zone collapses". London: The Telegraph. http://www.telegraph.co.uk/finance/2801987/Music-Zone-collapses.html. Retrieved 12 February 2009.
- ^ "Music Zone buying 41 MVC outlets". BBC News. 2006-01-04. http://news.bbc.co.uk/1/hi/business/4581326.stm. Retrieved 2011-09-03.
- ^ "Music Zone closes Scottish stores". BBC News. 16 January 2007. http://news.bbc.co.uk/1/hi/scotland/6267495.stm. Retrieved 12 February 2009.
- ^ "Further 800 jobs go as Music Zone fails to find buyer". Scotsman. 26 January 2007. http://business.scotsman.com/6983/Further-800-jobs-go-as.3341127.jp. Retrieved 12 February 2009.
- ^ "Music Zone sells stores to Fopp". BBC News. http://news.bbc.co.uk/1/hi/england/manchester/6333163.stm. Retrieved 2011-09-03.
- ^ Ernst & Young Press Statement
Categories:- Defunct retail companies of the United Kingdom
- Retail companies established in 1984
- Companies disestablished in 2007
- Companies that have entered administration in the United Kingdom
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