Andre Yoskowitz
25 Sep 2007 14:34
In an effort to stay in business, the large movie rental chain Movie Gallery has confirmed that it will be closing over 500 of its brick and mortar stores around the US.
Although bankruptcy has been widely feared for the company, CEO Joe Malugen hopes the move will bring the company back to financial health.
“Closing these stores was a difficult, but necessary decision to help protect the future of this company,” he said. “These stores are being closed after evaluating a number of factors, including store profits and the terms of the leases at each location. This action will allow us to focus our resources on the approximate 4,000 stores that have a stronger operating performance and prospects for future growth.”
Movie Gallery did not go into details about how many employees would be laid off or be transferred to other Hollywood Video or Movie Gallery locations and also did not go into whether customer's accounts would be transferred to nearby locations.
Movie Gallery has seen its stock plummet in recent months mainly due to losing market share after the introduction of "Total Access" by its main rival, Blockbuster.
Source:
VideoBusiness