Just 16 Days after announcing That EzyDVD Pty Ltd is was placed in receivership, 9 of their 26 company owned stores have closed according to this article. While it is unfortunate for the staff, it was bound to happen. What will be interesting over the next few weeks in what happens to the other stores, including the 32 franchised outlets.

The local economy has taken a bit of a beating over the last several months, and I would expect that many EzyDVD franchisees have not done as well as that may have hoped. Now that January is upon us there is the inevitable sales slump to come. Particularly in Canberra, where many residents take extended holidays at the coast, retail revenue is set to fall dramatically.

Of course, January sales will continue, however, I wonder at the stock that the EzyDVD stores will be carrying. In past years much of the January clearance stock came from head office. While I am sure that Head Office would be doing their best to provide for these sales, I think that the receiver would be unlikely to supply stock to franchisees with out payment up front. This would place the franchisees in a bit of a pickle… use the cash from pre Christmas sales to but January sale stock or keep it to pay their other supplier accounts?

I do not envy any current franchisee in the EzyDVD chain. While being a franchisee took its pound of flesh from me, I am, at least safely out of it now. I foresee much pain coming to those that currently have franchises.

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