HMV has put its ambition of opening new stores in 2025 on ice – and says the Budget is to blame.
The retailer had plans to add several more UK branches, but Doug Putman, HMV’s proprietor, earlier told The Times that the plans were now in limbo post-Budget announcement.
Confirming the halt in expansion, Putman said to City AM: “We’d love to continue to open stores and have done so this week with new locations in Kingston and Cheltenham as well as opening the HMV Bookshop at our flagship store. However, the cost to open new shops, and the risk associated with doing so, has undoubtedly increased since the Budget was announced.
“We normally aim to open 5-10 stores each year, though plans for further expansion in 2025 are on hold at the minute as we weigh up the impact of the government’s latest measures.
Delving into 2025 projections, Putman added: “When we look at next year, we’ve got everything on pause, so we could end up opening five stores. But I think more than likely we’re not. I think we’re probably getting close to zero.”
This development follows an earlier plea from UK retail leaders to the Chancellor, highlighting the severe effects anticipated from the Autumn Budget, including the likelihood of job losses.
Chancellor Rachel Reeves made controversial changes in last month’s Budget, raising employers’ national insurance contributions by 1.2 percentage points while also lowering the income threshold at which businesses start paying it, from £9,100 to £5,000. The decision was also made to increase the minimum wage for those over 21, officially referred to as the National Living Wage, by 6.7 per cent.
Helen Dickinson, the chief of the British Retail Consortium, who had previously expressed optimism about a Labour government, warned in City AM this week that the retail sector’s support for the government was hanging by a thread. She urged a reconsideration of decisions that would significantly ramp up retailers’ costs.
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