Pic: Hertfordshire Mercury
Retail administrations pile up as Debenhams finally close their doors after 240 years as suppliers take millions in losses
The Centre for Retail Research has been compiling and reporting on the demise and sometimes change of ownership of some of the big names associated with the High Street.
They emphasise that their listing is of UK only firms rather that ones owned by companies overseas. It was never going to be good news for the sector this year as already the number of retailers calling it a day look set to outstrip last year’s depressing statics. The Centre said: “So far, of the stores' at risk, 53% have been closed and 43.7% of 'at risk' staff have been made redundant. The equivalent figures last year were 36.9% and 20.6% respectively.”
Ikea have been reported to be interested in the empty Top Shop Oxford Street store so as expected some cash rich retailers and finance groups looking to invest in the next generation of stores are waiting to see how things pan out in 2021.
The Centre reported the Amanda Wakeley fashion shop in Mayfair along with its concessions in departments have entered administration as have Brooks Brothers UK Division along with Jessops photography shops.
They reported that the Preston St George Shopping centre is in the hands of administrators: “Preston St George's Shopping Centre went into the control of administrators on 1 February 2021, when its parent company (InfraRed) entered administration.”
They also had an update on Peacocks who left creditors with £22.9m in unpaid invoices. It is the low cast fashion chained owned by the defunct Edinburgh Woollen Mill that has been taken over by Anglo-Global Properties and is understood to be associated with PurePlay Retailing. The Centre reported: “It is thought that many of the investors in Global are suppliers to Peacocks. Philip Day owns certain rights over the company with a fixed charge over assets and expects to be repaid by the business eventually. These charges gave him preferential rights over the disposal of the corporation, even though it had been put into administration, owing HMRC £8.9m, creditors £22.9m, landlords £29m and staff £2m.”
Ian Carrotte of ICSM said the losses to suppliers were staggering. He said: “Some of the suppliers were landlords but many were one person businesses and small and medium sized companies. We give a heads up to members about firms in trouble but at the moment the retail sector and hospitality and travel industries are awash with rumours of potential failures. I urge any supplier to think carefully before giving too much credit to firms in these areas as they can destroy a small business if a big customer goes into administration and fails to pay up.”
There’s more eye-watering amounts lost by suppliers from the collapse of Arcadia from the Centre for Retail Research who reported that Arcadia’s chief supplier ASOS acquired from the shell of Arcadia the brands and websites of Topshop, Topman, Miss Selfridge and the athleisure HIIT brands in an effort to stem their losses. The Centre said: “News from Deloitte is that Arcadia owed creditors as follows: HMRC £44.2m, suppliers £163m, landlords £35.5m and giftcard holders £5.6m. As secured creditors, the Green's family loan of £50m takes precedence over the unsecured creditors. The bill for taxpayers will be around £250m+, consisting of the redundancy pay owing to sacked staff and supporting the pension scheme.”
Even a firm like EasyJet is not immune to the continuing problems of the travel restrictions and Covid-19 rules with losses of £700m this winter while Eurostar that had been on the brink of collapse has secured a £250m bail out from investors and banks.
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.
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For details for the work of the journalist Harry Mottram visit www.harrymottram.co.uk