CREDIT INSIDER: don’t get sucked into giving credit to ailing retailers – as Arcadia announce closing 31 shops and Superdry wobble after massive losses
Credit insider Ian Carrotte has warned members of ICSM Credit the credit intelligence group not to be ‘sucked into giving credit to ailing retailers’ in wake-up call as more big names go down.
It comes as the Arcadia group has announced the closure of more shops and the news that Superdry are in trouble.
Money up front
Ian Carrotte said: “Big name retailers use the ‘do you know who we are’ line in order to gain credit from suppliers when other avenues have been shut off. Unsuspecting businesses sometimes fall for the line – but when the retailer goes into administration they can find they simply don’t get paid. Or the big name spins out payment into months creating a cash crisis for the supplier.”
He said if some of the big names in retail come knocking then insist on sticking to the standard 30 day payment terms or even better money up front.
Arcadia
More of Arcadia owned stores are set to shut as potential buyers close in on their premium sites. These include Fraser Group and Next who are understood by ICSM Credit to be after Topshop.
The stores set for closure include 21 Outfit shops with a total of 700 job slashed. Deloitte, appointed by disgraced Sir Philip Green's Arcadia group, are desperate to offload the remaining stores to rivals. When the group went into administration last year there were 444 shops with 13,000 workers.
2021 is barely three weeks old but already Edinburgh Woollen Mill, The Jaeger brand and Paperchase have all hit the buffers. Ian Carrotte commented that this was the reason to be very cautious when dealing with the retail sector at the moment.
Superdry
The BBC reported today that Superdry had major problems. They said: "The warnings came as its half-yearly results showed a big rise in losses. Superdry said prolonged store closures and "subdued" footfall would continue to hit its revenues in 2021, sending the share price down 11%. But it said worries for the future were technical and its cash pile was strong. The retailer was in the midst of a turnaround plan when the virus struck. Unlike some of its competitors, it has an extensive store network, with many of its outlets in prime city centre locations which have seen fewer shoppers during the pandemic as more people work from home. In its results covering the 26 weeks to 24 October last year, Superdry reported a statutory pre-tax loss of £18.9m, compared with £4.2m a year earlier."
About ICSM Credit
ICSM Credit has more than four decades of experience as a credit intelligence group whose members gain inside information about firms in trouble allowing them to avoid bad debts and rogue traders. To join costs less than a tank of fuel - while at the moment there's a special free temporary membership offer during the Covid-19 crisis which gives access to free legal letters. ICSM also has an effective debt collecting service which has a global reach - ask for details from Paul.
For details about ICSM Credit call 0844 854 1850 or visit the website www.icsmcredit.com or email Ian at Ian.carrotte@icsmcredit.com on how to subscribe and to join the UK’s credit intelligence network to avoid bad debts and late payers. Follow ICSM Credit on FaceBook, Twitter and YouTube and Ian Carrotte on LinkedIn.
To keep up to date subscribe to the FREE ICSM Credit Newsletter to hear all the latest insolvency news and to see who has gone out of business click on the orange panel on the top left of the home page of the website www.icsmcredit.com or send an email to Ian.carrotte@icsmcredit.com
For details for the work of the journalist Harry Mottram visit www.harrymottram.co.uk