Tardy movie buffs cost stores millions

Store managers may spend 8 to 10 hours a week chasing DVDs and games that have not been returned. Photo / Brendon O'Hagan

Overdue rental fees are costing the New Zealand video industry millions of dollars.

The general manager of the United Video franchise, Lindsay Hall, said their 99 stores throughout the country would have about $150,000 in overdue fines each.

Movies such as Avatar and Boy and PlayStation games such as Red Redemption have huge demand as new releases and Mr Hall said they were hired out every night for the first few weeks.

"If a new release is sitting in someone's home we are losing money. If it is brought back even a day late a night's rental is lost."

He said fines had a large impact on the video industry in New Zealand but he did not expect they would ever be recovered.

Overdue fines cut into 8 to 10 per cent of the annual gross revenue of the nation's video-rental industry, which is about $200 million.

Martin Cambden, owner of a medium-sized United Video store in South Auckland, said he had $337,000 of overdue fines and stolen rental gear.

More than 6000 of his customers currently have late fees.

"We put a lot of effort into trying to recover overdues but so much of that effort never comes to anything," Mr Cambden said.

The Ponsonby Video Ezy store, which is the biggest in the country, has well over $200,000 of unpaid late fees.

Owner Nick Waite said a recent report produced 234 pages of customers owing more than $20 each.

After narrowing the report down to the store's active members, who had hired within the past 90 days and had more than $50 in outstanding fines, the list was still 34 pages.

Mr Waite said in an average weekend the store would hire out 6000 DVDs and the huge numbers made chasing the unpaid fines near impossible.

"There is a definite perception that once you have paid to hire it, it is not your fault if you bring it back late," Mr Waite said.

The store tries to manage the fines by a phone system that sends text messages telling customers to return overdue movies.

The store offers customers 50 per cent off the fine if they are willing to pay it the next time they come in to hire.

Mr Waite said the Ponsonby store manager spent six to eight hours a week chasing movies that had not been returned but often this was a waste of time.

"If someone gets $50 or $60 of fines they can't hire at our store any more, so often they just go to another one," Mr Waite said.

The joint managing director of Video Ezy International, Kevin Peterson, said it was not in the best interest of stores to pursue the late fees as they could upset customers and end up losing them.

"It is a fact of life that 10 per cent of people are going to be late."