If you visit one of Blockbuster Inc.’s 5,600 stores to rent a movie this weekend, you may not be the only one watching.

“We’ll literally be evaluating every single store,” James Keyes, the company’s CEO, said on Thursday following a bankruptcy hearing in Manhattan.

Reuters reported that Blockbuster filed for Chapter 11 bankruptcy protection yesterday as increasing competition from Web-based and mail-order movie providers continues to cut into the Dallas-based company’s sales.

“No one can predict what the market will look like for them going forward as Netflix and Redbox continue to take market share, so they are shooting in the dark,” said Michael Pachter, an analyst at Wedbush Morgan Securities in Los Angeles.

He noted that Blockbuster may have to close about 1,300 of its 3,300 U.S. locations in order to increase single-store sales to at least $1 million a year.

Going forward, Pachter said, Blockbuster may also have to rely more heavily on an older, affluent and less technologically savvy customer base as it continues to lose business to its online and mail-order rivals.

“What Blockbuster offers is a fairly high-priced product,” he said. “But you can get what you want immediately and the selection is extensive.”

In 2009, Blockbuster reached a deal with Duluth, Ga.-based NCR Corp., an owner and operator of DVD vending kiosks that pays royalties to Blockbuster for about 6,600 Blockbuster kiosks across the United States.

The Chapter 11 filing “provides the optimal path for recapitalizing our balance sheet and positioning Blockbuster for the future, as we continue to transform our business model to meet the evolving preferences of our customers,” Keyes said in a statement yesterday.

In court documents, Blockbuster listed assets of $1.02 billion and $1.46 billion in debt.