Yesterday, Blockbuster revealed
that it will close between 810 to 960 location by the end of 2010, a number that equals almost 20% of their stores and is significantly higher than a previously announced plan to shutter 380 to 420 stores. Blockbuster has been getting their butt kicked by Netflix and RedBox on pricing and innovation for awhile now and has been slow to alter their business model to adapt to today's more digitally conscious renter. So this doesn't surprise me that they actually are cutting more stores than they originally planned.
The problem is that when you start cutting that many locations, chances are you will do irreparable harm to the loyalty of your customer base and have no chance of getting them back unless pricing gets cut to bargain basement levels. Something a company struggling to generate revenue and closing 20% of their stores is unlikely to do. Based on other failed retailers since the economy went south (Circuit City, I'm looking at you
), this looks like the beginning of the end for Blockbuster and gamers should probably find an alternative method for rentals as your store could be gone sometime in the next 14 months.