Greeting card and CD chains go under

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The Independent Online

A dire Christmas forced two retailers to call in the administrators yesterday in a stark illustration of how the high street is dividing into winners and losers.

Greeting Card Group, which operates the Cardfair and Card Warehouse chains, blamed a slump in "high street footfall" over the past few months for its collapse into administration.

Music Zone appointed Deloitte to salvage what it could from its CD and DVD chain, which includes the MVC stores it bought from Woolworths last year.

Its private equity owners, Lloyds Development Capital, ran out of options after the chain's bankers, Bank of Ireland, withdrew its support "with immediate effect".

Music Zone said it had "no real alternative other than to appoint administrators" after failing to find a buyer.

Deloitte said it would keep all 104 stores open while it tried to sell the business as a going concern. It does not plan to make any of Music Zone's 104 staff redundant.

The collapse of two companies will raise fears over the fate of other retailers struggling with out-dated shop concepts. The rise of supermarket chains and internet-based rivals is putting particular pressure on entertainment retailers, discount clothing retailers and electrical stores.

Music Zone blamed "poorer than expected pre-Christmas spending" for its dismal performance.

Greeting Card Group, the UK's second biggest card chain, which had sales of £70m in the year to end-June, appointed PricewaterhouseCoopers to find a buyer for its stores.

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