ICSM Business – Retail Insolvency News: Cazoo deny they will enter administration this year as suppliers fear the worst

By Harry Mottram: There have been consistent media reports that the online car dealer Cazoo is in serious financial trouble sparking fears they could be insolvent by the end of the year. The company is reported to spending around £35 million pounds a quarter with lenders insisting it maintains £50 in funds to satisfy their terms.

Cazoo has been slashing costs in a bid to become profitable following a series of losses with a loss of £151 in the first half of the year published last August, with a loss of £241 million in the same period in 2022.

Cazoo issued a statement as speculation has increased saying they have ‘commenced an evaluation of potential partnerships, synergies, mergers, acquisitions, joint ventures and sales in the light of our improved capital structure.’

Ian Carrotte of ICSM - the business membership group dedicated to fighting bad debts and late payers with many members involved in the retail and motor industries – said: “This is such bad news as suppliers and staff will see these reports and draw their own conclusions. At ICSM we caution firms from taking orders from companies in danger of administration and to always seek ‘cash up front’ with a purchase order. It doesn’t matter how big or famous a firm is – any company can fail as we have seen with some of the biggest companies in the past.”

The firm started in 2018 selling used cars online in the UK and did well during Covid when customers couldn’t easily get out and look at used car lots. It is listed in America on the New York Stock Exchange following a deal with acquisition outfit run by Dan Och. Its founder Alex Chesterton quit soon afterwards when its value collapsed. It made an abortive attempt to expand into Europe but since 2022 has pulled out of France, Spain, Italy and Spain making hundreds of redundancies in an attempt to slash costs.

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