HMV. Nostalgia does not pay the rent.
HMV's sales are growing, but its historic Oxford Street shop is leaving again. A flagship can be valuable to a brand without earning enough at the till to pay for its address.
THE GIST ON HMV
Why can a growing business leave its flagship?
Revenue is not the same as the money left after costs. Huw looks at a shop whose historic importance makes it valuable to HMV, while the landlord can charge for that importance. Growth elsewhere does not automatically make the flagship affordable.
What does the famous address actually sell?
The Oxford Street store is also a billboard: it keeps the brand visible and connects it to its history. The very reason HMV wants the address can strengthen the landlord's position in setting the rent.
When is leaving the better decision?
A business can sell nostalgia without paying any price to remain in its original home. Huw's distinction is between the story a famous location gives the brand and the continuing bill for keeping that story attached to one shop.
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Quick answers
Why can a growing business leave its flagship?
Revenue is not the same as the money left after costs. Huw looks at a shop whose historic importance makes it valuable to HMV, while the landlord can charge for that importance. Growth elsewhere does not automatically make the flagship affordable.
What does the famous address actually sell?
The Oxford Street store is also a billboard: it keeps the brand visible and connects it to its history. The very reason HMV wants the address can strengthen the landlord's position in setting the rent.
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