Virgin Megastore
From Free net encyclopedia
Virgin Megastores is a chain of record shops throughout the world, established by Richard Branson. The first Virgin record store opened in London's Oxford Street in 1971. In 1979 the company opened their first Megastore at the end of Oxford Street and Tottenham Court Road. There are now over 120 stores throughout the UK and many more stores around the world, with an online store and a digital download service.
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Product selection
Virgin has one of the biggest collection of music available on the high street. Products sold here are not just Virgin branded items. Stores have a wide selection of releases by many current popular artists on many diverse mainstream and independent labels, as well as games, books, DVDs, videos, vinyl LPs, mp3 players and a wide range of games and entertainment items. Many stores house their own cafes and a virgin mobile concession.
Virgin vs. the Competition
As more and more high street stores venture into the media sales market keeping up with competition is proving to be a hard fought battle for the UK Megastores. Big name supermarket chains in particular have adopted stocking popular music and DVD titles at increasingly low prices. For example the DVD Wedding Crashers, released 28th Dec 2005 retailed at Tesco for £15.97 compared to a Virgin price of £19.99. The popularity of Video games has also seen cheaper competition keeping the customers away from the Megastores. A report published in August 2005 stated that Virgin Megastores have lost £260m in the past two years, according to accounts recently filed with Companies House, and remains solvent only with the help of hefty loans from other companies in Sir Richard's empire. The retail chain has borrowed £287m from related companies in the Virgin group, a debt that grew by £117m in the financial year to March 2004. Chairman John Jackson, a long-standing Branson lieutenant, said that since then the retailer has borrowed more from the parent company. However Virgin Megastores plans to break even in the 2006-2007 financial year. "A lot of hard work has been done to get the business into good shape," he said. Jackson said the first 18 weeks of this financial year had shown like-for-like sales similar to the year before, which was better than in the overall entertainment market.
The lenders in Sir Richard's empire are charging the retail chain an interest rate of 14% on the debt. A Virgin Group source said the company charges the rates that a venture capital firm would expect as a return.
The accounts stated that the music and video retailing business was still a "going concern" because the parent company had formally said it would provide enough funding for it to trade for at least 12 months. According to the accounts filed in Companies House, the Virgin Megastores group made an operating loss of £112m in the 14 months to the end of March 2004 due to escalating costs at the retail chain and the cost of re-organisation. A contributing factor was the inclusion in the accounts of the loss-making smaller stores, which were closed last year. Mr Jackson said this should also lead to a loss for the next financial year. The year before, the operating loss had been £146m due to a writedown of the Our Price chain, which was bought from WH Smith in the late 1990s but struggled and was turned into V Shops in 2001. Turnover increased in the 14 months to the end of March, compared with the 12-month period previously, because the smaller stores were included.
"During the year, the group encountered a difficult trading environment with significant price competition being experienced, in particular from supermarkets, that affected sales and margins," the company said in a review of the business in its accounts.
It said this prompted a "strategic review", which led to a £31m charge to cover leases and other restructuring costs. Despite massive amounts of money being spent on re-fits over the last few years and more focus being spend on their bigger stores the company as a whole struggles to break even. No profit being made during the period 2002 - 2006. This is a hard blow to the company who blame downloading and illegal copying as some of the major factors affecting their lack of sales. Sales in HMV Europe however, Virgin's biggest competetor for the full year ended April 2005 grew to £986.0 million and operating profit was £96.8 million.
In recognition of the increased choice the customer is now offered when it comes to purchasing media, the Virgin chain has employed several strategies to secure customer loyalty as well as focus on higher standards of customer service. The 'Addict card' introduced in 2005 was brought in offering customers a stamp for every £10 spent in store. The idea being that once the customer has collected 10 stamps, they are awarded with a discount of £10 off their next purchase. Also introduced was the 'Mega-sharp' approach to customer service - a feature which is now integral to the 'Virgin Megastores Experience'. Staff are encouraged to ensure customers found everything they were looking for each and every time a customer walks through the door.
The ongoing discounted sales within stores remain competetive with top CD/DVD/Games titles retailing for astonishingly low prices.
Competition against independent retailers mainly in the music sector doesn't pose a major threat for big companies such as the Megastores, however customers with a specialist taste usually find the independent stores more appealing offering more of a variety of 'hard to find' and 'rarer' titles.
Virgin also has an online service - www.virginmegastores.co.uk - which stocks the same entertainment product that can be found in the high street store, and has 48hr delivery guarantee and gift wrapping.
This same service is used in store for those customers who's item is currently out of stock. The system is called 'web enabled store' (WES) for short and guarantees the customer the item within 48 hrs and home delivery.
In 2005, Virgin Digital was launched to cater for those that bought their music digitally or wanted to rip and burn their current music collection. This is designed to add to the services provided by Virgin, rather than replace the Megastores. The download service has faced some criticism from consumer groups due to its in-compatibility with the highly popular iTunes program.
ELVIS
The computer system at the heart of the UK Virgin Megastores is ELVIS - EPOS Linked Virgin Information System - designed for the Virgin chain in 1991. ELVIS collects data from the store's point-of-sale terminals for stock and sales reporting; provides instant information for customers on all the store's product lines, holds play list information for Virgin Megastore Radio (accessible by all stores simultaneously); and allows for electronic re-ordering from suppliers.
Europe
UK and Ireland
- Portsmouth: Branson opened his first store here in the (now demolished) (Tricorn Centre), once a major calling for the UK's unsigned music scene. It has since relocated to (Commercial Road)
Image:Virgin Megastore - Oxford Street.jpg
- London: (Oxford Street at St Giles' Circus - Piccadilly Circus; the branch near Lillywhite's has now been joined by Number 1 Piccadilly, formerly owned by Tower Records)
- Bluewater: A two storied store is located on Thames Walk, opposite the Water Circus. Upstairs houses DVDs, games and other products such as phones by Virgin Mobile. Downstairs houses music exclusively.
- Cardiff Located at the Capital Shopping Centre on the corner of Queen Street and Churchill Way.
- Belfast: (CastleCourt Shooping Centre on Royal Avenue)
- Dublin: (Dundrum Town Centre)
- Limerick: (Crescent Shopping Centre)
- Glasgow: One store on Buchanan Street, is the largest record store in Europe, and a smaller store on Argyle Street.
- Cork: (Grand Parade)
- Newcastle Upon Tyne : (Northumberland Street)
- Liverpool, Clayton Square Shopping Centre: Large two floored store in the city centre with hourly rate Internet access.
- Sheffield, Fargate/Orchard Square: Large two floored store in the city centre refurbished in 2004. The ground floor houses music whilst downstairs houses video and classical music.
- There are additional Megastores in such cities as Birmingham,Nottingham, Manchester [[Leicester) and Edinburgh.
- There are also several smaller stores across the UK, some called Virgin Megastores Express and Virgin XS stores which can be found on the high street and at all major UK airports.
Germany
There are also plans to open a Virgin Megastore at the Berlin Hauptbahnhof, Berlin, in 2006. It would be the only Virgin Megastore in Germany.
France
- Paris: (Champs-Élysées, Louvre shopping mall, Montmartre & Gare de Lyon)
- Strasbourg: Rue du 22-Novembre.
- Montpellier
Greece
- Athens: (Stadiou 7-9, Syntagma Square)
North America
USA
- Phoenix, Arizona
- Orange, California at The Block at Orange.
- Hollywood, California
- Los Angeles, California
- Ontario, California
- Sacramento, California at Arden Fair. This location closed in 2005.
Image:San Francisco Virgin megastore 2.JPG
- San Francisco, California at Stockton St. and Market St.
- Denver, Colorado
- Miami, Florida
- Orlando, Florida at Walt Disney World's Downtown Disney.
- Chicago, Illinois at Michigan Avenue.
- New Orleans, Louisiana
- Boston, Massachusetts at Back Bay.
- Las Vegas, Nevada at Caesar's Palace. This location closed in 2005.
- Times Square, New York
- Union Square, New York
- Westbury, New York at The Mall at The Source. This location closed in 2003.
- Dallas, Texas at Grapevine Mills
- Dallas, Texas at Mockingbird Station
- Salt Lake City, Utah at Gateway District.
Canada (historical)
The only Virgin Megastore in Canada was in Vancouver, on the corner of Robson and Burrard. This location closed in September 2005, and has changed ownership to HMV, which has a similar inventory.
There was a project in Toronto, the Metropolis development, in which Virgin was meant to join. However, due to the dominance of HMV in Canada, Virgin decided to exit the Canadian market entirely.
Worldwide
Australasia
North Asia
- 23 stores in Japan:
- Utsunomiya, Tochigi
- Shinsaibashi, Osaka
- Kita-Senju, Tokyo
- Ikebukuro, Tokyo
- Ueno, Tokyo
- Nagoya, Aichi
- Sendai, Miyagi
- Atsugi, Kanagawa
- Kawasaki, Kanagawa
- Kawagoe, Saitama
- Shiki, Saitama
- Tokorozawa, Saitama
- 新潟, 松山, 梅田, 水戸, 溝口, 町田, 盛岡, 草加, 蒲田, 静岡
North Africa and Middle East
- Egypt: (Cairo citystars Egypt, the largest shopping centre in Egypt)
- Kuwait City: Virgin opened this brand new store mere days before the 2003 Iraq War; it is located in the ultra-popular Marina World complex and is the largest Virgin Megastore in the Middle East
- Beirut: (Martyrs Square) This Megastore is located in the old Beirut Opera House.
In Store Radio
Most stores include an in-store radio station. In the USA these are branded Virgin Radio, although are not related to Virgin Radio in London. In the UK, partly because of this branding issue, the in-store radio stations are branded Virgin Megastores Radio (VMR).