UPDATE: Blockbuster annouced it will file Chapter 11 Bankruptcy on September 23, 2010.
Blockbuster Video's business has been in decline for several years and according to the Los Angeles Times, the company will file for bankruptcy protection this month.
It's likely Blockbuster will file for Chapter 11 bankruptcy protection and continue to operate while it reorganizes company finances. This means a few things for consumers and gift cards:
- Gift cards will still be sold and accepted by Blockbuster
- More blockbuster locations will close making gift cards less convenient to redeem
- The Blockbuster Gift Card continues to be a risky purchase
As a result of the company's declining financial condition, ScripSmart already considered the Blockbuster Gift Card to be a gift card worth avoiding. In fact, a warning is placed on any gift card we believe to be a risky purchase. It's just another good reason to check the Gift Card Score® before making your next gift card purchase.
The current message reads:
Blockbuster's competitor, Movie Gallery/Hollywood Video, filed for chapter 11 bankruptcy several times before closing doors for good. The signs were there and now the Hollywood Video Gift Cards are worthless.
Blockbuster will be around for the foreseeable future. However, many consumers tend to hold on to gift cards for an extended period of time and if Blockbuster closes doors for good, gift card holders will be left with nothing.
The article also mentions Blockbuster closed nearly 1,000 stores in 2009 is looking to close between 500-800 as a result of this bankruptcy filing. It's an important step in reducing debt, but results in a gift card which may not be nearly as convenient to redeem.
ScripSmart Can Help
We recommend using gift cards as soon as you receive them. For those who tend not to redeem gift cards right away, a ScripSmart Account can help give you a push and provide some extra protection from being stuck with a worthless gift card.
ScripSmart monitors the gift card landscape and if we hear of a company filing for bankruptcy or closing doors, we'll send you a heads-up via email. ScripSmart's alert system is just one of several benefits of a ScripSmart Account. Best of all, ScripSmart Accounts are easy, free and helpful; simply sign up and add the cards you own to your account. It's easy to reap the benefits of ScripSmart.