Pandemic Forces Family Video, America's Last Video Rental Chain, to Close Its Doors

Facing an already shrinking business, the pandemic proved too great a wound for America's last major video rental chain to survive and on Friday, Family Video will close the last of its 700 stores. The end of an era, it comes at a hauntingly appropriate time.

"My dad, who started the business, might have opened the very first video stores in the country," Keith Hoogland, the company's president, told Newsweek. "He passed away on June 25th and within six or seven months, the video business ends. He died at the same time as Family Video dies."

At its inception, Family Video was cutting edge, but like all businesses of its kind, it became archaic and Hoogland wasn't naive enough to think the video rental business would stand the test of time. He thought they had two or three years left, but then the pandemic hit and the closures, combined with the lack of new movie releases proved to be an insurmountable problem.

Once stores reopened in early to mid-July, Hoogland was waiting for the business to return to pre-pandemic levels, but they "didn't even come close." By September 1, he knew Family Video wouldn't survive.

Not wanting to get into the politics of the pandemic, Hoogland took some issue with the classification of "essential" businesses. While millions of people can stream thousands of movies from their couch, Family Video provides people in small towns, where there's little to do and some can't afford Netflix, "essential" entertainment.

"Everyone talks about the blue-collar worker—the people who can't afford this and that—but then in this situation that's who they were hurting," Hoogland said. "They're not thinking clearly about what's essential for those people who are less fortunate. I think we realize there's been a lot of damage done to people in terms of depression and what if we thought about that in terms of what's essential? Entertainment could be essential when you're talking about having nothing to do."

family video pandemic closure
Family Video closed its last store on Friday, a year or two earlier than the company's president thought they would. Family Video

The closure will put about 5,000 Family Video employees out of work, mostly in small and rural towns where "jobs are meaningful and hard to come by." And, Hoogland didn't expect those jobs to come back.

Hoogland's father, Charlie, a man he described as "charismatic" and a "great leader," created Family Video in 1978, and while often a forgotten character in the story, Hoogland made it known nothing would have been possible without him. Charlie turned the reins over to Hoogland 34 years ago and with the complete trust of his father to take it in whatever direction he wanted without question, Hoogland kept Family Video alive long after nearly every Blockbuster closed.

Family Video's ability to stay open is due in part to the company owning its buildings instead of leasing. As the video rental business shrunk, they weren't stuck with high rent costs and could adjust the size of the store to meet demand. The installation of pizza places in adjacent spaces both helped cover costs for Family Video and gave customers a chance to get a movie and dinner delivered to their door.

"That's the luck of the draw and maybe I could have done something better or smarter," Hoogland said.

The pandemic proved to be a double-edged sword for the company, though, because as it boosted the pizza business, it delivered a fatal blow to movie rentals.

"That's the luck of the draw and maybe I could have done something better or smarter," Hoogland said.

To remain open, stores need to do a certain level of business to pay bills and when states shut down last March, it cut that business down to $0. Juggling the different protocols of the 20 states where Family Videos were located was no easy task and reopening proved difficult. They had to spend money marketing the reopening to customers and with 70 percent of their business being driven by new releases, without new movies, people didn't have a reason to come in.

Family Video stopped renting movies in January and has since been working on selling off their inventory. In the wake of the closure, Hoogland's gotten to see how much the company meant to the communities it served. Thousands of people begged the video rental chain to stay open and employees who haven't worked for the company in 15 years have called to say how much they loved working at Family Video.

Reflecting on the past three decades as the head of Family Video, Hoogland's proud that employees became like family members. They had the opportunity to buy into an LLC that does real estate investments and are now using those returns to retire and those who were district managers or higher could use a company-owned condo in Siesta Key for a week-long vacation, free of charge.

"We consider some of these people who worked for us for 30 years, family. I'd do anything for them and they'd do anything for me," Hoogland said.

The last remaining Blockbuster is still open in Bend, Oregon, and Hoogland was sure there were a few mom and pop video rental shops out there somewhere. But, the end of Family Video closes the final chapter on large chains and it's something Hoogland always knew would happen.

In its wake, new tenants will move into the empty space Family Video occupied, relegating the once thriving business to a nostalgic memory as time moves farther away from a world where people had to leave their homes and browse shelves to find just the right movie for that night.