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Ann Summers

That’s not to say we don’t recognise or look forward to it - Usually it’s a time of getting together with friends, enjoying fireworks and music and taking a moment, just after midnight, of quiet reflection on the events of the year just passed. 

So what about the second year of the new decade? 

Well so far, it’s very similar to the last one - in some instances even more restrictive with a new national lockdown and schools being closed forcing many parents into juggling home schooling requirements along with their regular jobs and parenting responsibilities.

And what about businesses? 

Many remain locked down and unable to trade and several sectors that would have been banking on an improved or even normal Christmas trading period to bolster their balance sheets for the year or give them a sufficient boost to see them through to the Spring, remain in an unsatisfactory stasis.  

So while we continue to strive to bring you some positive news, here’s our regular round-up of all the important administration and insolvency stories that you might have missed this month. 

Edinburgh Woollen Mill and Bonmarche survive

A consortium led by the current CEO of the Edinburgh Woollen Mill (EWM) group has brought the brand out of administration, keeping some 1,984 jobs. 

The sister brands of Ponden Home and Bonmarche were also included in the deal and will remain open although a total of 119 unprofitable stores and 500 positions will be lost under the new company. 

The remaining EMW property, Peacocks, remains in administration while Marks and Spencer bought the Jaegers brand, but not the high street stores which will not reopen as a result. 

Ann Summers switches lanes

Ann Summers. the adult fashion and relationship accessories store, has had a CVA approved by 90% of its creditors which will see 25 of its stores immediately switch to a turnover-based rent system. 

No stores will close or jobs will be lost and this agreement will not affect the terms of its remaining 66 stores.  

Chief Executive Jacqueline Gold said: “This has been a year like no other for Ann Summers. The pandemic presented new challenges for our business in 2020 which are likely to continue into the early part of 2021. 

“There is still a very important place on the British high street for Anne Summers and with our store costs now largely rebased to reflect today’s much changed retail environment, we can not only continue to grow our strong and successful online and Party Plan channels, but our iconic stores will also be able to thrive once conditions return to normal.”

PaperChase looks to avoid folding

Cards and stationery retailer Paperchase has filed notice to appoint administrators as it continues to seek a way forward after a tough 12 months trading. 

The group has 173 stores and concessions employing 1,500 staff and was particularly vulnerable to the pre-Christmas shopping restrictions as approx. 40% of it’s annual sales are made in November and December.

A spokesperson for the group said: “Out of lockdown we’ve traded well, but as the country faces further restrictions for some months to come, we have to find a sustainable future for Paperchase.

Originally founded in 1968, the company has had multiple owners including WH Smith and now defunct US bookseller Borders.

Paperchase entered into a company voluntary arrangement (CVA) with its creditors in 2019 to close some unprofitable stores and reduce rents by switching some to a turnover-based model but the unprecedented conditions of 2020 might have proved the final straw. 

Game Over for Arcadia’s Outfit stores

The Arcadia group’s struggle to remain active continues as they announce the immediate closure of another 31 stores across the UK with the loss of 714 jobs. 

21 of these included the Outfit brand which allowed shoppers to visit all of the Arcadia names such as Topshop, Wallis and Dorothy Perkins, in one convenient location.  

The group entered administration in December 2020 and while the Evans brand has been sold, buyers are still being sought for all of the others with the administrators deadline drawing near.  

The fate of 13,000 staff across over 700 stores remains in the balance. 

While time can seem to be slowing down if you’re waiting for permission to reopen and begin trading again, it can also seem to move very fast if things start to go wrong or get out of your control. 

Some help and funding remains available to businesses to mitigate the financial devastation caused by the pandemic but it still might be enough for a lot of businesses to manage until they can begin to open up and return to doing what they do best. 

But this time of inactivity might also prove to be a time for taking action if you are worried about how you’ll get through these critical next few weeks and months. 

You can arrange a free initial consultation with us whenever you want

There are still several options you can look at pursuing to either help secure your business so it can survive the ongoing lockdown or there can be ways to help you change direction and begin the new year with a new direction - but only if you start making those decisions very soon.

Topshop
 
 
 
 
 
 
 
Whether you’re in hospitality, retail, education, construction or any other sector - there has been a significant impact on your business and on the lives of your staff and customers. 
 
Welcome to the second part of our 2020 business review covering July to December.
 


 
The summer finally arrived in July but some this wasn’t enough for Yorkshire-based homeware and gifts retailer Peter Jones. 
 
The 50-year-old business had ten stores across the county and 70 staff who were on furlough and made redundant when the company closed due to insolvency.  
 
It was a similar story for prestige shoe company Oliver Sweeney which closed its stores in prestigious Mayfair, Leadenhall Market and Covent Garden in London permanently along with outlets in Leeds and Manchester too. 
 
CEO Tim Cooper confirmed the physical stores would not reopen and added: “We are disappointed that the stores will no longer continue, but we are confident and excited about the brand going forward online.” 
 


 
August saw one of the biggest names in the UK health and leisure sector close its doors for the final time.
 
DW Sports went into administration with the loss of 1,700 positions across the UK. 25 of their stores closed immediately along with the company website while the remaining 50 would close after seeing through closing-down sales.
 
The company said its income was hit by the mandated closure of gyms and stores due to the Covid lockdown. 73 DW Sports branded gyms would also be closing but its sister company Fitness First which operates 43 health clubs would be unaffected by the developments. 
 


 
Most sports in the UK were affected by Covid-19 which meant the English football season kicked off later than usual although one name was missing from the fixture list. 
 
The Silkmen of Macclesfield Town were wound up with debts of over £500,000 including £190,000 owed to HMRC.
 
The winding-up petition began in January 2019 and had been adjourned several times previously before the patience of the Insolvency and Companies Court finally ran out despite an offer from a would-be purchaser. 
 
The Judge granted a compulsory winding-up order saying that the purchaser had not provided a business plan for the club should they take over, nor was there any evidence that the club would be able to pay its debts if allowed to continue in the Vanarama National League which they were relegated to at the end of the previous season.
 


 
October saw the nutritional food-to-go chain Abokado enter a pre-pack administration with the loss of 150 jobs. 
 
The business was unable to open any of its 19 London locations since the first lockdown in March
 
Founder Mark Lilley said: “Unfortunately, in light of the continued uncertainty, the accumulating liabilities and the existing leasehold structures, it was impossible to secure sufficient investment to reopen the business.
 
“For a business which is entirely dependent on London’s office community, the overnight shift to working from home and the emptying out of central London has been simply devastating.  
 


 
November began with a canary in the mine moment, although we didn’t know it at the time. 
 
Peacocks and Jaeger went into administration after owners - the Edinburgh Woollen Mill group, couldn’t find a buyer for them, leaving 4,700 positions in the balance. 
 
Worse was to follow for EWM as they themselves announced that they too would be entering administration days later placing another 2,800 jobs at risk. 
 
Chief Executive of the group Steve Simpson admitted that the past seven months had been extremely difficult for the group. A buyer or new investors are still being sought but Simpson admitted that some job losses and store closures would be inevitable. 
 
The month ended with one of the biggest insolvency bombshells of any recent year. 
 
Arcadia, the parent company of Topshop, Topman, Wallis, Dorothy Perkins, Burton and Miss Selfridge, announced their administration and placing 13,000 jobs in jeopardy - with 9,000 employees still remaining on furlough. 
 
Administrators said that the pandemic had severely impacted sales and that stores would continue to trade in the short term with no redundancies announced while a buyer was sought. 
 
Hope for a stronger Christmas trading period was dashed for women’s clothing chain  BonMarche as they went into administration for the second time in just over a year placing 1,500 jobs and 225 stores at risk. 
 
A spokesperson for the administrators said: “Bonmarche remains an attractive brand with a loyal customer base. It’s our intention to continue to trade whilst working closely with management to explore the options for the business.”
 
Then we had the news that following the collapse of takeover talks with JD Sports that Debenhams announced that they would begin a liquidation process, which is desperately sad news for their remaining 12,000 employees and 122 UK stores. 
 
The company had gone into administration in April and JD Sports were widely seen as the last remaining credible buyer at this time. 
 
The administration of Arcadia exacerbated the circumstances as Debenhams and Arcadia remained each other’s largest customers through concessions and other trade. 
 
Sadly the ongoing story of 2020 - administrations, liquidations and closures - looks set to continue into 2021 with the traditionally strong Christmas trading period being affected by tough local lockdowns continuing to be implemented across every region of the UK. 
 
Businesses hoping to survive and prosper in the next 12 months can strengthen their chances of being around to see the end of the pandemic and the return of stronger trading conditions if they take action now. 
 
Getting professional advice on how to make your company more robust and responsive to quickly changing conditions and customer behaviours can be done right now. 
 
You can get in touch with us today to arrange a free initial virtual consultation for your business. 
 
There’s several small and big changes you can make to shore up your company for the short term and be ready to take advantage when the trading weather changes. 
 
No matter what situation you’re facing - we’re sure we can help. All you’ve got to do is ask!

Wheatsheaf

Photo by Reece Horton


The Chancellor Rishi Sunak delivered a spending review which will have ramifications for their businesses in terms of support and tax liabilities. 
 
The arrangements for Christmas will be announced by the four UK nations governments along with finding out the new Covid-19 tier status of every local authority in the country which will let some businesses know if they can open at all. 
 
Others will find out what they can sell with various restrictions and one of the busiest shopping days of the year - Black Friday - is hours away. 
 
With so much happening, it’s easy to miss some of the biggest insolvency and administration stories that happened this month but we’re happy to bring you up to speed.   
 
Edinburgh Woolen Mill Group
 
Four of the UK’s top high street names owned by the same group all entered administration within a tumultuous two week period this month. 
 
Edinburgh Woolen Mill and Ponden Home closed their physical retail stores on November 6 with the immediate loss of 860 positions. They are owned by the Edinburgh Woolen Mill Group is ultimately controlled by entrepreneur Phillip Day. 
 
Less than two weeks later, two of the groups other central brands - Jaeger and Peacocks - also entered administration putting a total of 6000 jobs in jeopardy while administrators work to restructure and eventually sell the business to prospective buyers. 
 
A spokesperson said: “Recent months have proven extremely challenging for many retailers, even those that were trading well before the pandemic, including the teams at EWM and Ponden Home. 
 
“Regrettably, the impact of Covid-19 on the brands’ core customer base and tighter restrictions on trading mean that the current structure of the businesses is unsustainable and has resulted in redundancies.
 
They continued: “In recent weeks we’ve had constructive discussions with a number of potential buyers for Peacocks and Jaeger but the continuing deterioration of the retail sector due to the impact of the pandemic and second lockdown have made this process longer and more complex than we would have hoped.”
 
They confirmed that a “standstill agreement” had been secured with the HIgh Court that had temporarily put off administration but had expired. 
 
“Therefore as directors we have taken the desperately difficult decision to place Peacocks and Jaeger into administration while those talks continue.”
 
Wheatsheaf Shopping Centre
 
It’s not just shops that are closing at the Wheatsheaf Shopping Centre in Rochdale, the whole centre is closing next month for good. 
 
In recent years it has lost big anchor tenants including Argos, New Look, Wilko’s, Rymans, Brighthouse and Select but the news is still devastating to the remaining stallholders. 
 
Charles Denby of MCR Property Group who manage the centre said: “The ongoing coronavirus pandemic has expedited the migration from traditional shopping habits and the impacts on the retail sector have been significant. 
 
“Since reopening after lockdown in June 2020, footfall has been tracking at an average of 45% down year-on-year and this lockdown will impact these figures further. The financial viability of the centre is not sustainable.”
 
He continued: “Nationwide we continue to see a large number of retailers experiencing serious trading difficulties, and more are resorting to insolvency procedures to cut their rent bills. 
 
“When the change in shopping habits collides with reduced income, an excess of space and cost structures that are simply no longer realistic, landlords have to take action.” 
 
Vanners
 
A silk company which had been trading in Suffolk for nearly 250 years has gone into administration with the loss of 32 jobs. 
 
Vanners was founded in 1740 and moved to Suffolk in the late 18th Century when the county became the hub of the British silk weaving industry. 
 
Still designing and manufacturing silk fabrics and products for the fashion and furnishing sectors, Vanners provided silk for Her Majesty Queen Elizabeth II’s coronation gown as well as more recently the singer Adele and former US First Lady Michelle Obama. 
 
A spokesperson said: “Vanners had been experiencing difficult trading conditions for some time, which was exacerbated by the severe impact of Covid-19 on the fashion sector. We intend to fulfil outstanding orders while we seek a buyer for the business.” 
 
Revolution
 
The city-centre based Revolution Bars has entered a CVA which will see six of its sites close immediately. 
 
While they anticipate that the group's cash flow will improve over the two-year period of the arrangement, they said that the long-term impact of Covid-19 including a one-off £1.1 million cost, meant that they must consider all necessary options to ensure the business can remain viable. 
 
Chief Executive Rob Pitcher said: “I’m grateful for the support of our creditors in approving the CVA which is a positive step in the right direction for the business.”
 
He also said that while he welcomed government support, the hospitality sector had been severely affected by it’s “often illogical, inappropriate and disproportionate response to the pandemic. 
 
“To plan ahead, we still require guidance on how the sector can ultimately exit the current restrictions in a safe and timely manner.”
 
Abercrombie and Fitch
 
American bellwether fashion retailer Abercrombie and Fitch announced that it will be closing its flagship London store as part of an “ongoing global store network optimization initiative” that aims to reposition the brand from larger format, tourist-dependent flagship locations to smaller store that cater to local customers. 
 
This cuts the number of “flagship” locations from 15 to 8 by the end of January 2021. CEO Fran Horowitz said: “As we approach the peak holiday selling period, inventories remain well-controlled and we have thoughtful plans in place to help us adapt to changing business conditions. 
 
“As we have done since the start of the pandemic, we will utilize our proven playbooks to remain agile and provide the best omnichannel experience for our customers.”
 
Although it might be argued that the pandemic has rendered most retailers playbooks obsolete which is why so many are having to change their strategies and look for insolvency advice to survive.
 
One thing that can be guaranteed in this most inexplicable, unexpected year is that things will be busier in the remaining month of 2020. 
 
Some companies will be made by the decision taken in the next couple of weeks but sadly some will also be broken if they cannot function normally because of local or national restrictions. 
 
It can be hard to remain focused when there is so much happening but if you’re running a business and you feel like you’re running out of time and places to turn - there is a route available for you - and it always will be. 
 
We’ll arrange a free initial consultation with you when it’s convenient to discuss what your company is up against. 
 
Once you get in touch we can give you our professional assessment on your available options including some ideas you might not have thought of yourself. 
 
Time is critical right now so the sooner you get in touch, the quicker you can then act to protect and preserve your business but only if you act while you can.  Some options are time limited and with an uncertain festive period ahead, these days and weeks ahead might be the difference between how you welcome in 2021. 

Boots
 
 
 
 
 
 
Centuries old practices will fall by the wayside, to be replaced by new structures and codes that have only come of age in the past few weeks - Zoom meetings anybody?
 
Received wisdom will be reexamined and while some customs and rules will remain, others will be looked back on with a mixture of amusement and bewilderment that they were followed for so long. 
 
We doubted that paying rent would be one of these however, but these are strange days. 
 
Firstly, we covered how some retailers such as Boots and Matalan have taken issues into their own hands and refused to pay rent for this Q2 2020 which came due earlier this month.
 
The landlords of Boots in particular are particularly aggrieved as the store is classified as an essential business so remains open and generating some income and sales during this period. 
 
One of the landlords said: “We’re trying to support the little guy, the small independent traders whose sole income is through the cash register. I said to Boots - my ability to help those people is directly related to the people who could and should pay rent, paying that rent.”
 
Then there were reports that other retailers beginning with the Edinburgh Woollen Mill chain of retailers are including pandemic clauses into any new leases it’s due to sign with landlords of Bonmarche stores that their owner, Philip Day, brought out of administration last year.
 
The clauses would mean that EWM could agree on new Bonmarche store leases without having to pay any rents upfront until the lockdown is lifted and non-essential stores can reopen for business. 
 
This also means that the company will be refunded any rent payments by their landlords should another pandemic hit in the future. 
 
It seems that the authorities have been paying attention because the government has now banned landlords from using the threat of statutory demands and winding-up orders to claim any unpaid rent due to the crisis. 
 
Commercial tenants also have the option to delay full rent payments unless they are already three months in arrears. 
 
Section 82 of the Coronavirus Act 2020 already prohibits the forfeiture of commercial leases until 30 June 2020 (or longer if the government deems necessary) specifically for non-payment of rent. 
 
As written, the law didn’t prevent other actions including recognised debt recovery devices until the new measures were introduced. 
 
While some businesses have no revenue coming in, the government hoped that landlords would have some forbearance and look to cooperate with their otherwise profitable tenants.  
 
The reality is that some landlords decided to take strong measures first because they were also struggling for income from tenants, some of whom aren’t reciprocating openly themselves. 
 
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A new business world is coming. 
 
It might be weeks or months away but it will arrive and bring a host of changes with it. 
 
Rent boycotts, debt recovery bans and niche rental clauses may be the first outliers of an evolving environment but they certainly won’t be the last. 
 
You need to start thinking about how your business is going to adapt to a new environment when it becomes time to open up permanently again. 
 
Where will you have a strong advantage? Where will you be in danger of being outflanked and left vulnerable? What part of your company will need evolution and which revolution? 
 
Get in touch with us today to schedule a conversation around these topics and more. 
 
We’re used to asking questions that need more than a yes or no answer and make you really think about what you and your business will need going ahead so you can re-emerge with all systems go. 

Business Rescue Expert is part of Robson Scott Associates Limited, a limited company registered in England and Wales No. 05331812, a leading independent insolvency practice, specialising in business rescue advice. The company holds professional indemnity insurance and complies with the EU Services Directive. Christopher Horner (IP no 16150) is licenced by the Insolvency Practitioners Association

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