Movie Gallery Stores Closed, Company in Bankruptcy

Sunday, May 30, 2010

Movie Gallery closed its doors, and its bankruptcy (filed for the second time in February) is widely seen as a sign that the end could be at hand for "brick-and-mortar" rental video stores everywhere.

The company announced last month that it would be closing and liquidating all that remained of its once 4,700-store empire. The one in Carthage closed suddenly, leaving customers a note to take videos back to the Vass location. That store is now gone as well.

More and more video content comes by mail from places such as Netflix and Amazon. Supermarkets such as Lowes Foods and Harris Teeter sprout drink-box-like DVD kiosks where the latest movie titles wait to be rented as customers head home with their groceries. No VHS is available except at truck stops and in sale bins at discount outlets.

In Carthage, the local Movie Gallery closing caused consternation for one elderly resident who had grown used to walking up to Movie Gallery once a week to return her viewed tapes and pick out the next ones.

"Where am I going to go now?" she said. "I don't have a computer."

DVDs themselves may be heading for the same dustbin of tech history as eight-track players, movie projectors, wire recorders, Victrolas and gramophones. Prognosticators say direct digital streaming is the future for such home entertainment, with movies ordered online and paid for by credit or debit card numbers "entered" on a keyboard or a cell phone keypad.

Newer cell phones, dubbed smartphones, have voice recognition even for Web surfing, so purchasers could just ask the machine in the hand to send them a movie and start watching a moment later.

In Carthage, the store was built for Movie Gallery by Riddle Group, which is a father-and-son enterprise operated by Sam and Sammy Riddle, who also own the John Deere dealership across the street. When the first bankruptcy hit, the Riddles stayed with their tenant.

"They had been great tenants," Sammy Riddle said. "We wanted them to do as well as they could, so we worked out a new contract. They were actually very good renters. In September or October last year, they had problems. We did some things for them and just gave them every opportunity we possibly could.

"All the stores around us - Fayetteville, Sanford, Robbins - everything closed down. We had tried everything we possibly could do to try to help them, but I think their obstacles are just too high for them to operate."

Eventually, there was no money to pay rent. The store had to close. The last open Movie Gallery in the county was in Vass.

"Movie Gallery in Carthage owed back rent for a couple of months," said Adam Acers, manager of the Vass store. "That is actually why they got only a 24-hour notice to close their store. The corporation is now in liquidation. It is more a question of assets now (than rentals)."

Only a very few years back, the future looked bright for Movie Gallery. The company bought out Hollywood Video, a bigger competitor. Their purchase made Move Gallery the second-largest rental chain in the country.

That was also the turning point year when Netflix, Redbox and other delivery systems began to edge into video rental markets in unexpectedly large ways. The boat began to leak. Now it is sinking.

Blockbuster, the top chain, is facing declining revenue and is closing stores. The situation both Blockbuster and Movie Gallery encountered could be an illustration of the perils of entering in a technology-driven business.

Acers thinks overexpansion caused the problem and cost him and everybody else at Movie Gallery their jobs. Their last open stores will be in Canada.

"We are not going out of business because of competition," Acers said. "I want to stress that. That is not the reason. Netflix and Redbox are not the reason. Just tell everybody we really appreciated their business."

Contact John Chappell by e-mail at jchappell@thepilot.com.

More like this story

moberry 2 years, 11 months ago

Good riddance, these movie rental stores have been bleeding customers dry for decades with shady business practices. I haven't been to a movie rental store in years thanks to On Demand through the cable service, and Netflix.

prfxshn 2 years, 11 months ago

Def good riddance. I remember Robbins had a few family run movie rental stores that were forced out of business when the Movie Gallery came to town.

dustyrhoades 2 years, 11 months ago

A big problem with MG was that visiting the store was usually such a frustrating experience. It took forever to get anything done because the store personnel had such trouble navigating the computer system. From listening to their comments and the comments of the managers who always had to come and bail them out, working the thing was apparently only slightly less complex than flying the Space Shuttle.

dustyrhoades 2 years, 11 months ago

True. I think I went to MG maybe three times since getting Netflix.

maillady54 2 years, 11 months ago

Hey, does anyone remember Sharon and Harold Chamberlain at That's Entertainment? A true small family business. Theirs was one of the first video rental stores in Moore Co..Still open, still trying to compete with the online rentals ,red box, smartphone streaming videos and all that stuff. Everyone gripes and moans about big businesses, but how many of you have stopped by, said hello and rented a movie from Harold or Sharon?Everyone talks about the good old days, which included, mom and pop stores, saying hello to your neighbor,buying locally.So come on, turn off your phone,your pc,if just for a few minutes, step outside, buy a cone from the local ice cream shoppe, get a paper from the street hawkers,and rent a movie from That's Entertainment.

TheNeedle 2 years, 11 months ago

"The only reason they are still in business is their back room ;)"

Oh, they still have porn then? How quaint. Anything good?

leftfield 2 years, 11 months ago

"Oh, they still have porn then? How quaint. Anything good?"

It's all probably still on VHS.

SCCstudent 2 years, 11 months ago

Adiòs - no more late fees Blockbuster! Greed got the best of concrete and mortor outlets.

@TheNeedle => have you surfed on your computadora? Just watch out for those nasty virus's, malware, bots, spyware and spiders. The gift that keeps on giving ~ until your hard drive crashes. Viagra won't work on that one. LOL

FaithinUSA 2 years, 11 months ago

This is soon going to be the way of the Post Office...... video stores had there place and time. When it cost you 50.00 to 100.00 to take your family to the movies a 4.99 video and some microwave popcorn was a deal...

AFadedRose 2 years, 11 months ago

Reading the previous comments regarding a local video store with the "back room" feels like rubbing salt in a wound to me. The store with the "back room" has hurt my marriage more than you could imagine. For the numerous people who are hooked on pornography, it is like a Cash Bar sitting in the middle of an AA meeting. And yes, my marriage was already experiencing "difficulty", so please don't flame me with comments about how the store didn't cause the problem. My pain is real and genuine even though the love and sex on the videos in the back room are not.