UK brands that have gone into administration since COVID

Big UK brands that have gone into administration since COVID-19 and the cost of living crisis

Throughout the tumultuous years since 2020, the UK has seen a huge number of businesses enter into administration. In some cases, brands have been able to keep trading under new ownership, or online only. Others have been lost completely. 

Among these are high-street staples including Debenhams and Topshop. But major online brands have suffered too, including big names such as Made.com. It shows that no one can get too comfortable when it comes to maintaining a business, big or small. 

Below, we’ll unravel the reasons behind their struggles, and examine the lessons learned to help guide small business owners through these challenging times.

Ted Baker

In March 2024, Ted Baker announced it would be forced to call in administrators for its European outlets and online retail, putting close to 1,000 jobs at risk.

Even before the pandemic, the brand was rocked by scandal. In 2019, the company’s founder Ray Kelvin stepped down following allegations of inappropriate behaviour. New owners, Authentic Brands, attempted to steady the ship, but the colossal impact of the pandemic set Ted Baker up for a desperate few years. Lockdown hit, workwear changed, and in the post-pandemic world, trends changed, with fewer office workers seeking to buy new collared shirts – a Ted Baker staple.

The news is so fresh that it’s not yet known what steps Ted Baker’s administrators (Slaughter and May) will take, and if the brand presence will remain on the UK high street.

The company’s existing licensing deals (such as with Next) are unaffected, and more may be set up depending on how the administration process goes. Ted Baker also still has a presence in the US, Asia, and the Middle East.

What’s the main consideration for small businesses here?

Ted Baker has struggled in recent years for a number of reasons. Some of these relate to factors that will come up again and again in this list – most notably, the unrecognisable shape of UK retail in a few sort years since COVID first hit. In-person retail has failed to regain ground, while ecommerce shopping has become more competitive than ever before.

Changing consumer trends were a critical struggle for Ted Baker, too. With office workers wearing more informal attire as the return to office culture shifted after the pandemic, paying top buck for starched collars felt like a throwback from another era. Ted Baker’s branding calling card of playful prints helped it to stand out, but attracting younger Gen Z consumers remained a challenge, particularly given their increasing savviness for finding pre-loved equivalents on Depop or Vinted.

Beyond this shift in trends, Ted Baker had a real crisis of ownership. Following Kelvin’s step-down, the brand entered into a tumultuous period under Authentic Brands Group (ABG) and the company’s own holding company, No Ordinary Designer Label (NODL). According to the last accounts filed at Companies House, NODL reported a pre-tax loss of £43 million in the year to January 2022, despite sales of nearly £320 million. In February, the company severed relationships with AARC, which was operating its UK and Europe retail stores and online ecommerce business, pointing towards rough waters for the brand, citing the cause as business arrears that were too high to overcome.

The lesson for smaller business here is when seeking new investors or even potential new parent company owners, be truly wary of any existing debts they may hold, and be especially cautious around their operational capability to help you succeed with your own growth ambitions.

The Body Shop

In February 2024, the new owners of The Body Shop – private equity group Aurelius – confirmed that the high street skincare and cosmetics stalwart was entering into administration. With over 200 stores in the UK, and thousands of employees on its payroll, this was a bitter blow for a once-loved brand that dated back to 1976.

The Body Shop had lost its place as a must-visit home for high quality, non-animal-tested cosmetics and skincare products. By late 2023, sales had spiralled, and younger Gen Z consumers felt little of the brand affinity that had once driven customers to be passionate advocates for the high street brand.

On top of this, there was a corporate mess behind the scenes. Aurelius was contending with a legacy bonus scheme for 20 employees that could cost in the region of £2m-£3m.

What’s the main consideration for small businesses here?

There are a few key reasons why The Body Shop failed – but chief among them was a period of poor trading when the brand would typically expect to perform at its strongest. The Body Shop endured a torrid Christmas sales period in 2023, leaving the business in a precipitous position at the start of the new year.

Most bizarrely, the Aurelius group owners only completed purchase of The Body Shop a few weeks before Christmas. Just a couple of months later, they found themselves releasing a statement about appointing business advisory firm FRP as Joint Administrators of the company.

A key lesson for small businesses is not to leave yourself vulnerable to the whims of any single trading season. “One bad Christmas” was enough to sound a death knell for The Body Shop.

Though, in truth, an accumulation of other factors were working against the brand. It had lost some of its core brand identity and original mission purpose as a home for cruelty-free products, following a sale to L’Oreal in 2006. Original founder Anitta Roddick had been instrumental in securing the company B-Corp status, but the core company values were felt to have drifted after the sale to such a huge parent company.

Wilko

Rumours began circulating that Wilko – one of the nation’s best-known homeware retailers – was on the verge of collapse in late July. Founded by the Wilkinson family in Leicester 92 years ago, the chain is a high street staple with 400 stores across the UK.

After a week of uncertainty, Wilko bosses confirmed they had failed to secure a rescue deal. On August 10th, Wilko collapsed into administration, becoming the latest casualty of the cost of living crisis and putting an estimated 12,500 jobs at risk. At the start of September, discount chain B&M initially struck a deal to buy 51 Wilko stores, providing a potential limited lifeline for the brand’s high street presence. However, by 12th September the deal had fallen through, and all existing Wilko stores were confirmed to close by early October.

Some commentators have compared Wilko’s demise to the failure of Woolworths, another homeware brand that collapsed in 2008 as a result of the financial crisis.

At the time, Woolworths left a considerable gap for Wilko to fill with its affordable, everyday items. But Wilko has since struggled over the past decade due to growing competition from cheaper rivals like Poundland and B&M.

Taking on the job as administrator is PwC. According to the auditor, it is hopeful that a buyer will come forward to acquire all or part of Wilko Limited. Until then, the stores will stay open to consumers.

Commenting on the announcement, Jane Steer, partner at PwC said it was “an unsettling development for everyone involved with the business – particularly its committed team members – and the communities it serves across the region”.

What’s the main consideration for small businesses here? 

Wilko’s business leaders worked on everything possible to avoid falling into administration, embarking on a series of cost-cutting measures that chief executive Mark Jackson insisted would have led to “the most profitable Wilko ever recorded within 24 months”. But this, still, wasn’t enough.

There’s a lesson here for smaller business owners to keep an obsessive eye on their cost of goods sold, and to do everything possible to minimise the overheads that make your profit margin tighter during this challenging economy.

For Wilko, the pricing strategies of rival online retailers proved exceptionally hard to keep pace with. The brand was being undercut on price but competitors that didn’t have the substantial costs of maintaining multiple business premises and the staffing numbers that accompanied them. With a whirlwind of high business rates, increasing staff salary expectations and extraordinary business energy costs, it was tough for Wilko to stay on top of its overheads at a time when consumer spending was tighter.

Debenhams

Debenhams was a department store with a challenge. It wasn’t John Lewis. It certainly wasn’t Selfridges. It was just…there. As the pandemic crept up, the brand was already in a challenging environment, struggling to define its own identity and failing to keep up amid competition from ecommerce. 

Nonetheless, it was a familiar high street giant, where one could browse around aimlessly for an hour and try on all manner of different brands. It was a draw for such a variety of people because the store was so varied, with floors upon floors of products.The one I knew best and frequented most was situated in Clapham Junction (pictured). It was an undeniable piece of the view, the landmark you couldn’t miss – nestled firmly in the arms of some astounding Victorian architecture.

Debenhams announced its administration in December 2021, winding down a staggering 12,000 jobs. The last store was closed in May 2023, ending an era marked by dwindling year-on-year sales.

The brand name now lives on, online-only. Boohoo purchased Debenhams for £55 million in January 2021. On the 12 April, Boohoo relaunched the Debenhams website with a new full range of Boohoo products. 

According to Drapers, Debenhams will introduce a new premium fashion division on its website later this year. Talks are ongoing with potential brand partners, although the specific price range for these premium brands hasn’t been disclosed by Debenhams.

What’s the main consideration for small businesses here? 

In essence – it’s simply crucial for you as a small business owner to ensure that your brand never loses its way. Small businesses must carefully evaluate their product portfolio to avoid falling into the trap of offering too many products that may dilute their brand message.

Debenhams’ decline can be partly attributed to a loss of brand identity and a lack of differentiation in the market. As a business owner, a good practice would be to regularly revisit your brand strategy from time to time and reaffirm your unique value proposition through your products whenever possible. 

Debenhams faced challenges with an extensive range of products, leading to concerns about whether the brand was effectively targeting its intended customer base. 

To avoid this in your own business, a good idea would be to focus on understanding your target market and curating a product lineup that aligns with customers’ needs and preferences. 

By honing in on a specific niche, target audience and unique value proposition, you should be able to develop a strong brand identity and subsequent customer engagement and loyalty.

Arcadia Group

Phillip Green’s Arcadia Group was a seemingly undefeatable conglomerate of retail brands. For young fashionistas, its stores – including Topshop and Miss Selfridge – were staple destinations where a whole generation could congregate to grab affordable bling for a holiday, or to dress to impress even on a tight budget. 

Only a few years back, stepping out of the tube station at London’s Oxford Circus and seeing the busy throng outside the flagship Topshop  store, you’d have thought the good times might never end for Arcadia Group. 

Yet in November 2020, with the pandemic already bruising retail trading, news broke that Philip Green’s vast empire had succumbed to a crushing debt exceeding $1 billion. This was exacerbated by underperformance in sales in the years prior to COVID, with the emergence of online fast-fashion brands hurting Green’s empire like never before. 

Those same rival businesses would snap up the pieces of Green’s empire. In February 2021, ASOS acquired the Topshop, Topman and Miss Selfridge brands for £265 million. 

Boohoo Group acquired three more of Arcadia Group’s brands (Burton, Dorothy Perkins and Wallis) for £25.2 million. These now continue on as ecommerce stores only.

The shops have remained closed, and most employees were unfortunately lost. For young shoppers, a big-draw destination has been removed from the high street, too.

What’s the main consideration for small businesses here? No one truly knows when a crisis – a global pandemic of all things – might hit. But nevertheless, it’s crucial for small business owners to maintain as healthy of a financial position as possible just in case: to closely monitor their cash flow and avoid excessive debt in order to withstand any unexpected economic downturns. 

It’s all about the safety net. It’s important to keep your costs reasonable however possible, even in the good times. Keep a humble outlook and a good business continuity plan firmly in your back pocket, and never lose sight of what your competitors are up to.

For Philip Green and Arcadia Group, there were a cluster of challenges even beyond the eye-watering debt. BooHoo, ASOS and more fast fashion brands were eclipsing the brand relevance of Topshop, Topman and Miss Selfridge. It had been a generation since Burton, Dorothy Perkins or Wallace had had any brand relevance at all.

In hindsight, considering the substantial debt burden his companies were facing, Philip Green could have potentially mitigated the collapse by focusing on strengthening his sales and branding teams. By investing in a skilled and strategic sales team could have implemented effective sales strategies, and optimised revenue generation, while a more robust branding team could have worked towards refreshing the brand image, while staying competitive against brands that had nailed fast fashion online.

Victoria’s Secret

How quickly it can all fall away. With a huge cultural impact spearheaded by its annual fashion shows and household-name supermodels, Victoria Secret were the trendsetters – until somehow, suddenly, they weren’t.

The UK arm of the US lingerie retailer went into administration in June 2020, in a move that saw all Victoria’s Secret stores closed in Britain. 

It’s hard to unpick if their administration (and subsequent liquidation period) were wholly the result of COVID challenges, or also a series of downfall events for the brand. There were scandals between these tumultuous years, adding kindling to an already quite flammable situation, as people were tiring of the over-sexualisation and hype. 

Victoria’s Secret’s empire fell because the world started to move on without them. 

During recent years, our beauty ideals have shifted to become more inclusive, with brands such as Rihanna’s Fenty embracing darker-skinned and fuller-figured women in its identity. Victoria’s Secret, meanwhile, clung to its ‘vision’ for too long, which allowed more inclusive brands to come forward and knock them off the top spot. 

So between COVID struggles and accusations from employees of bullying, harassment and misogyny, Victoria Secret was floundering as a high street presence.

They had some guardian angels of their own, however. L Brands and Next formed a joint venture where they acquired substantially all of the assets of the Victoria’s Secret business in the United Kingdom and Ireland. 

The joint venture bid saw the UK business resurrected in 2022, and they now trade from physical stores again as well as their website. Meanwhile, the brand as a whole has belatedly moved on from its ‘angels’ culture, pivoting towards a more inclusive product lineup and using models with a more diverse range of body sizes and backgrounds.

What’s the main consideration for small businesses here? There is a line, as Victoria Secret discovered, between maintaining a brand image and simply being stubborn and dismissive. 

While staying true to your vision is vital, it is equally crucial to at the very least try to acknowledge changing trends and shifting beauty standards. And this doesn’t even have to be within your own brand – it can be achieved by simply demonstrating support for other movements, collaborating with like-minded brands for special projects, or adapting some of your messaging to reflect evolving consumer preferences. 

A brand with an aspirational vision is different from one pushing an unsustainable ideal. Amid revelations that most Victoria Secret models eat little to nothing weeks before shows, the brand was falling out of step with the body positivity movement. 

When customers feel alienated or disconnected from a brand, they are more likely to abandon it. They should feel inspired by your brand without being made to feel inadequate or excluded. If your messaging comes across as condescending, elitist or exclusionary, customers will quickly lose trust and abandon your brand.

Adapting to evolving trends doesn’t equate to selling out. By embracing change, collaborating with others, and remaining inclusive, your business can absolutely retain its authenticity while staying relevant.

Also, try not to get into any scandals.

Oak Furnitureland

This one was quite surprising because it seemed such a staple of the UK business scene: with 105 showrooms in the UK and such a large, friendly presence along highways and such that you just expected to always be there. 

Growing up, Oak Furnitureland was one of those mythical places you’d hear about on the radio for the most part. Finally, one day you’re on a road trip with your parents and pull into one of those large parking lots to see it for yourself. Then, you’d run off into one for the first time and get lost for a few hours while an agent tries to convince your dad that the new navy blue three-seater sofas (that recline!) are all the rage right now.

Fortunately this is still the case as we’ll get into in a moment – Oak Furnitureland survived – but let’s first talk about how they got into financial trouble to begin with.

First, the obvious: people weren’t all that concerned about furniture shopping at the height of the pandemic. 

In fact, when lockdown was severely hindering deliveries and people had been furloughed from their jobs, it was probably the furthest thing from anyone’s mind. As their business model also primarily relied on in-person viewings and the salesmanship that made you fall in love with a product, it was hard to replicate that magic online for the brand. 

Oak Furnitureland cited the root of their problems as “averse trading conditions” which most business owners can understand. We were all there.

There was light at the end of this struggle for Oak Furnitureland, however. The business was saved from the brink of collapse by a hedge fund manager, saving 1,491 jobs in the buy-out process.

What’s the main consideration for businesses here? There are valuable lessons to learn from Oak Furnitureland’s entry into administration, and some advice to consider.

Don’t wait until it’s an emergency to diversify your promotional methods. It’s essential to continuously explore and invest in various avenues to promote your business. 

Instead of solely relying on traditional offline sales, embrace the power of online sales and take it seriously. Establish a strong online presence, optimise your website for e-commerce, and leverage digital marketing strategies. By diversifying your promotional methods early on, you can expand your customer reach and mitigate the impact of unexpected events.

And also, always have a Plan B. While it may seem unlikely for another catastrophic event like COVID-19 to occur, it’s crucial to have contingency plans in place. 

Prepare for unforeseen circumstances by considering alternative strategies – for instance, Oak Furnitureland could have taken pre-orders, run digital campaigns, or explored adjacent markets such as hospitals or homeless shelters to provide furniture to. 

These alternative avenues could have not helped the brand through customer loyalty but also enhanced its reputation and created new opportunities for growth.

Monsoon / Accessorize

Monsoon is a popular fashion retailer that’s all about women’s style and self-expression. If I had to summarise – their ethos has always been about embracing your unique side with bohemian-inspired designs, vibrant colours, intricate patterns, and cool ethnic vibes. With sister brand Accessorize, customers were also covered for bags, jewellery, and scarves that came in clutch to complete your look. 

When the Monsoon/Accessorize group entered into administration due to the pressures of COVID, 35 stores were closed with a loss of 545 jobs. But they were soon bought out of administration in June 2020 by founder Peter Simon himself. This saved the retailer’s other 2,300 UK employees and helped the brands to retain their high street presence. 

In what might be one of the most interesting comebacks on this list – Monsoon persevered and fought their way out of their struggles. By the end of December 2021, the business was debt-free with net cash of £15 million. Monsoon and Accessorize currently have 154 stores back open in the UK. This is down from 230 at the time it went into administration, but it feels like something of a comeback era all the same.

What can small UK business owners learn from this? According to Retail Gazette, Monsoon’s turnaround focused on a brand refresh (introducing more sustainable fashion in their ‘Bazaar’), further portfolio renewals, international expansion and cost control among other things. 

This positive development resulted in a significant boost for the company, as group sales surged by 43% to reach £258 million in the period ending on August 31st. The retail sector experienced remarkable growth, with like-for-like sales for Accessorize skyrocketing by an impressive 105%. It was absolutely stellar work – all fuelled by a man’s desire to not have circumstances define him and a refusal to lose his empire.

It’s crucial for small business owners to understand that all hope is not lost if they find themselves in a situation where they need to register a dormant company or if their company goes into administration. 

In some cases, if financially viable, the business owner can be the one to buy themselves out through a pre-pack deal or other acquisition methods. Being the one to buy yourself out during an administration process can provide a chance to restructure and revive the company. 

Even during an administration period, it is possible to continue trading and work towards a turnaround, so there’s still time to consider emergency pivots or a complete rebranding strategy to adapt to changing market conditions. These actions can breathe new life into a struggling business and help it regain momentum. By embracing these possibilities and staying proactive, entrepreneurs can navigate challenging situations and potentially turn their company’s fortunes around. 

The brand made smart plans for its rainy days, and for now at least, it’s monsoon season again. 

Oasis

Oasis (or their parent company, “The Oasis And Warehouse Group”) was one of those unassuming, non-problematic shops that you would tend to see at the end of every high street. No biggie, just a cool spot to stop at and pick up a T-Shirt or some loose jeans, especially if you were passing a store in your local high street.

Behind the scenes, however, there had been quite a tumultuous history of the company as they experienced a wild ride of highs, lows, and memorable moments – including multiple shifts in CEO, partnerships and ownerships – including one time a UK-based Indian entrepreneur offered to purchase The Oasis And Warehouse Group for £60 million, while being wanted by Interpol.

Nevertheless, this was a business that had managed and would have likely continued to manage its finances well sans the pandemic. It happened, however, which left the business with three main public-facing challenges:

• The successful rise of online fashion retailers such as Boohoo (who were known for bringing fast fashion to customers online) were a significant contender in the war for customer attention.
• Boohoo had also previously rescued competing traditional outlets Coast and Karen Millen 
• Oasis was controlled by the Icelandic bank Kaupthing which defaulted in the Icelandic financial crisis of 2008 and which, relative to the size of Iceland’s economy, is considered one of the largest systemic banking collapses in economic history.

What’s the main consideration for small businesses here? In the midst of all the panic, the way the CEO of Oasis, Hash Ladha, handled the crisis was exceptional. 

He made efforts to keep customers calm and ensure that they felt heard. Ladha promptly informed customers that they could still place online orders, and for those self-isolating, packages could be received contact-free. 

He acknowledged the government’s advice on social distancing and working from home, and displayed empathy by recognising the unprecedented shift in our lives. 

There are valuable lessons to be learned from Ladha’s approach to crisis management. Throughout, he demonstrated good leadership and an attitude of always being in control.

Beales

Beales was a true legacy business. The original Beales chain, which had been around for 139 years, went into administration in January 2020. By March of that year, when the Covid crisis hit, the brand had to close all of its stores. Sadly, this put 1,300 jobs at risk, and the company reported losses of £3.1m during the worst part of the crisis – and owed a staggering £12.6million in loans.

KPMG was appointed as administrator to handle Beales’ affairs, though it’s unclear what the future holds for Beales. As of today, there haven’t been many public updates about progress since the pandemic began. Beales does still sell online, but, unlike plenty of other brands on this list, Beales failed to get acquired and find a new owner.

What’s the main consideration for small businesses here? When times get tough, it’s crucial to cut unnecessary costs as much, and as fast, as possible. Beales failed to find a way to exit its leases or secure rent reductions through negotiation. With rising commercial mortgages and high commercial rents, it’s no easy thing to haggle –   but these can be crucial tactics for smaller businesses to attempt. 

Running a physical store also involves more expenses than just rent. Don’t forget to closely analyse your full labour costs, likely business rates, emergency expenses, business interruption insurance, and other unforeseen expenses – before even eyeing a property. Have you taken everything that you can possibly think of into account, and not just for now but in your five-year plan, in times where circumstances may be a little tougher? Are you aware of the differences between the “nice to haves” and the “absolute essentials”?

Your customers are your lifeline, so treat them well even up until the very end. Beales did a good job of honouring its commitments to customers, by accepting gift vouchers, honouring deposits, and providing returns and refunds.

Similarly, it’s important not to burn bridges. Beales’ CEO, Tony Brown, criticised local councils for not supporting struggling retailers in a BBC interview. He pointed out that councils still collect business rates even if stores close, as the landlord is responsible for paying – in quite a pointed tone to the media. 

While of course, unforeseen and immensely devastating times such as the pandemic brought up a lot of anger and frustration, but try to keep positive relationships with local authorities, landlords and financial backers. If things calm down and your business is in a position to bounce back, your new opportunities could depend on their cooperation.

And finally, location matters. Beales had most of its stores in towns and secondary cities, while competitors like Debenhams, John Lewis, and House of Fraser had locations in major cities throughout the UK. Choosing the right location can have a significant impact on a business’s success.

Aldo

The shoe retailer Aldo (owned by The Aldo Group) faced financial difficulties and had to close down five of its stores in 2020. Despite these challenges, however, The Aldo Group remained confident in the strength of its company and its brands. At the time, it released a statement affirming that Aldo “will continue to be a global brand with a strong presence in over 100 countries.” 

The Aldo Group planned to use the situation to restructure its business and expand to other regions. The goal was to ensure the long-term stability of the company and its international operations.

The UK arm of Aldo’s operations was ultimately acquired by an investment firm called the Bushell Investment Group (BIG) back in the same year. This acquisition not only saved 55 jobs but also led to the creation of 50 new roles. It also safeguarded investments, totalling more than £30 million in Aldo UK’s trade and assets.

What are the main considerations for small businesses here? It’s clear from The Aldo Group’s statement that it wanted to convey confidence in its ability to bounce back. The brand undeniably had more resources than the average UK small business owner – most of whom cannot simply pick up and simply take their business to international markets immediately. 

There are a few things we can take from Aldo’s strategy. The retail industry, like many others, can be unpredictable. It’s important for small business owners to be adaptable and prepared for changes in the market. While immediate international expansion may not be feasible, being open to exploring new opportunities and adjusting business strategies accordingly is vital.

Another good idea in this instance would be to simply hunker down. Brace for impact, put everything into “survival mode” and maintain what you have. The Aldo Group was confident in its promises of a comeback – but they didn’t say when. It effectively bought itself time to reassess and strategise, before making any promises to its customers that may not have been achievable, eroding long-term trust.

Rather than pursuing rapid growth, prioritise the long-term stability and sustainability of your business. This involves carefully assessing your current situation, identifying areas that require improvement or restructuring, and making necessary changes to ensure your business remains resilient.

Oliver Sweeney

By late March 2020, shoe-stalwart Oliver Sweeney was facing difficulty with its trading, and ultimately had to bring in administrators. The Covid-19 lockdown forced it to shutter all stores as non-essential. And, even after the restrictions eased, the business made the tough decision not to reopen them. Instead, Oliver Sweeney chose to exit the physical retail space through administration. 

This wasn’t the first time Oliver Sweeney had faced administration. Back in 2009, the company was rescued by Amery Capital. 

Despite the store closures, CEO Tim Cooper said he was optimistic about the future. He expressed his disappointment regarding the closures, but conveyed confidence in shifting the focus of the business to the online realm and wholesale operations. 

The company remains determined to adapt and continue its operations online, under the leadership of Cooper.

What’s the main consideration for small businesses here? The lessons in the case of Oliver Sweeney are simple: keep going, adapt, maintain a positive attitude where you can, and seize the opportunities of shifting your market focus. 

Le Pain Quotidien

The UK arm of the Belgian-owned bakery chain Le Pain Quotidien fell into administration in 2020, which left 500 jobs under threat.

They were ultimately rescued from administration in June of 2020 by BrunchCo21, a branch of the larger Belgium investment firm Cobepa. But, not without casualties, as we’ve seen with almost all of the businesses on this list so far. 

All in all, the administration and rescue period resulted in 11 location closures and 200 job losses. This left 16 of Le Pain Quotidien’s 26 locations operational in the UK. 

What’s the main consideration for small businesses here? The most interesting and inspirational approaches Le Pain Quotidien took as a company were harnessing the power of solidarity, and not immediately taking things at face value. 

Let’s highlight once again that these were unprecedented times. But, because nothing like this had ever happened at such a scale and within our lifetimes, who was to say how the rules had to be determined?

Le Pain Quotidien (and associates) were not afraid to push back a little on what they felt was unfair and unreasonable – namely, still having to pay rent for a property when it was guaranteed there would be no footfall. Many other chains such as Burger King, Franco Manca and ASK Italian also did not pay rent for the quarter, as they sought to preserve as much cash as possible.

The combined troubles of the industry also spurred a man named Jonathan Downey, a business owner of multiple venues in the UK, to set out to lobby for a nine-month rent-free period for hospitality businesses in a campaign, titled #NationalRentFree, in an attempt to save them. 

This shows the power of being part of an industry or community that has resolved to look out for each other for the greater well-being of the UK economy, instead of simply leaving their associates to fend for themselves. Camaraderie always has the potential to garner impact and change.

Laura Ashley

While the pandemic was devastating for its business, Laura Ashley’s issues began pre-COVID, and it had issued profit warnings even before the start of the pandemic. In 2019, it had losses of £9.8m, but managed to repay some of the debt using the proceeds of property sales.

The business was administered by PwC, then acquired by Gordon Brothers – and returned to the UK high street in Spring 2021, along with new stores, thanks to a new partnership with Next. The price of the acquisition is unknown.

Main considerations for small businesses: It’s a really good idea to issue profit warnings to your stakeholders when you feel there are or might potentially be upcoming financial issues in the near future. 

On a business’s part, it shows a lot of consideration for the people who have faith and rely on you, builds trust, and shows that you are aware of issues rather than avoiding the problems until they are too far gone to fix.

Peacocks/Jaeger

The Edinburgh Woollen Mill Group (who own high-street stores such as Peacocks and Jaeger) filed notice to appoint administrators in October 2020, affecting 24,000 employees in total. 

However, it wasn’t too long before Peacocks at least was saved. It was bought out of administration by a senior executive named Steve Simpson, with backing from himself and an investors consortium from Dubai.

Jaeger ended up surviving in online form only, after having their intellectual property rights purchased by M&S, who now sell their products as third-party items on their site.

It is believed that between Peacocks and Jaeger, 463 stores are now permanently closed, while 103 Peacock stores remain.

Main considerations for small businesses: Brands can shapeshift. You are not confined to any one means of production or avenue of sales. 

So all is not lost, and time may not have been wasted if you ever have to wind down your company – there are certain assets, tangible and intangible (such as intellectual property such as your brand as a whole, or your trademarks) that can be negotiated on with interested parties. 

The trick here is just to build your business to a level where it is desired. It needs to become valuable enough that investors are able to see past the current setbacks and envision the potential of your brand within a brighter future.

Quiz

Quiz was a Glasgow-based brand that ran 82 standalone stores. It was put into administration as part of a restructure in June of 2020, closing 15 stores. 

The business also had to downsize its employee headcount to accommodate the smaller spaces they were preparing to manage the businesses from.

Tarak Ramzan, the CEO of Quiz stated at the time: “We continue to believe that stores, with appropriate property costs and flexible lease terms, can continue to be a relevant pillar in our omnichannel model and we will be seeking to re-open Quiz stores where we believe it is prudent and economic to do so.’’

According to The Herald, he and his family bought the vast bulk of the business back immediately through a pre-packaged deal.

Main considerations for small businesses: A good lesson to take away from this is – where possible – to negotiate rental and leasing terms closely, and account for the worst-case scenarios. 

A flexible lease term may be preferable for a small business owner, giving some leeway in the event of limited footfall. It is a hard thing to ask of a landlord, who would definitely prefer a set amount each month. But, if you can convince them to add a clause in the contract that there are certain allowances in the event of extraordinary events, then it’s worth the ask. 

Made.com

Made.com is a furniture and household retailer that gained significant traction in the market. It focused on offering stylish and affordable furniture through its online platform, catering to a broad customer base.

The company entering administration in November 2022 endangered hundreds of jobs. They had faced financial difficulties and had stopped accepting new orders since October of that year. 

The business was subsequently sold to Next, with the deal involving the transfer of brand, websites, and intellectual property. But, this did not include stock, staff, or other assets and liabilities.

Main consideration for small businesses: Small businesses operating in the retail industry should be mindful of evolving market dynamics, including shifts in consumer behaviour such as a preference for speed and convenience through ecommerce. 

Building a strong online presence and staying agile in response to changing market conditions are essential for sustainable growth.

Cath Kidston

Cath Kidston was well known for its unique and vibrant designs. Sadly, the company went into administration in late March 2023. It had 125 staff members and had faced financial challenges since 2020.

It was put into administration by its private-equity owners, Hilco Capital. Its intellectual property and brand were then acquired by Next through a pre-pack arrangement. The remaining stores were slated for closure.

Main consideration for small businesses: If your small business has cultivated a strong customer base and is known for something (as Cath Kidson was known for its vibrant designs), another option may be to retain your intellectual property rights or sell these if there is a sufficient financial incentive.

Planet Organic

Planet Organic is an ethical sustainable supermarket group with a focus on organic and natural products. It operated more than twelve stores across the UK and was known for its commitment to environmental and social responsibility.

In April 2023, Planet Organic went into administration due to financial difficulties. After expressions of interest from various businesses, it was eventually acquired by Bioren, a company partially owned by the founders of Planet Organic. Planet Organic had £12.5 million in debt when it went into administration. 

As a result of the acquisition, four stores closed, leaving the business with ten stores and 265 employees.

Main consideration for small businesses: Now more than ever it is important to carefully manage your finances and ensure you have a strong customer base to sustain operations. It will be crucial to be able to constantly adapt their strategies to meet changing market demands, while also staying true to your core values.

Eve Sleep

Eve Sleep is an online mattress retailer operating in the UK, Ireland, and France. It gained significance in the market for offering convenient and affordable mattresses through its ecommerce platform. However, the company faced financial challenges due to increased costs and supply issues.

They fell into administration in October. The management cited a “tsunami” of increased costs and supply issues as the primary reasons for their financial difficulties. The company was acquired by Bensons for Beds shortly after it entered into administration.

Main consideration for small businesses: Small businesses should take note of the importance of managing costs effectively and maintaining a robust supply chain. Monitoring and addressing any potential financial challenges promptly can help prevent a similar fate.

Joules

Joules is a fashion chain that experienced financial difficulties and collapsed into administration in November. The retailer, known for its clothing and accessories, faced challenges that led to the suspension of trading in its shares. Despite the administration, Joules aims to continue supplying its products under the administration of Interpath Advisory.

Joules’ administration put over 1,000 jobs at risk, reflecting the severity of its financial struggles. The collapse of the company raises concerns about the future of the brand and the potential impact on its employees and customers.

Main consideration for small businesses: Seeking professional advice and exploring alternative funding options can help overcome financial challenges and avoid bankruptcy. Communicating openly with customers and suppliers about any potential disruptions can also help maintain trust and mitigate negative impacts.

TheVeganKind (TVK)

TVK is the largest UK vegan supermarket that specialises in offering a wide range of vegan and cruelty-free products. It operates both as a physical supermarket and an online retailer, serving customers across the country.

TVK appointed administrators in October but was immediately bought in a pre-pack deal by its largest shareholder, ensuring the continuation of operations. All 38 employees were transferred to the new ownership, allowing the business to continue trading without interruption.

Main consideration for small businesses: TVK was saved by its popularity in this case, and the faith people have in the fact that it has longevity and the potential to bounce back in future. Small businesses should recognise the importance of having strong venture capital support. Looking at diversifying their product offerings in future is another way to maintain innovation and intrigue. Additionally, establishing sustainable business models and working on branding may help them weather any more storms.

AMT

AMT is a coffee specialist that operates coffee shops in airports, train stations, and hospitals. It was founded in 1993 and had a significant presence in the market, offering coffee to travellers and customers in convenient locations.

AMT went into administration in November 2022 and was subsequently purchased by SSP Group. However, the company experienced job losses, with 100 employees being let go. While 25 coffee shops were saved and continue to trade, 18 sites were closed down along with the head office.

Main consideration for small businesses: Small businesses should take into account the potential challenges of operating in a particularly niche market, especially one that is heavily dependent on external factors like travel patterns and location. Ensuring financial stability, adaptability, and diversification of revenue streams might help you mitigate risks associated with market fluctuations.

Sofa Workshop

Sofa Workshop was a High Street retailer with both physical stores and an ecommerce presence, specialising in sofas.

The company collapsed recently, resulting in the loss of 77 jobs. Supply chain and transport costs contributed to trading losses, outweighing significant revenues. Existing orders will be fulfilled, and the customer order book was sold to Timothy Oulton United Kingdom Ltd.

Main consideration for small businesses: Supply chain issues are a recurring issue for quite a few of the businesses mentioned on this list, but transportation costs also come into play here and they are another thing you must watch diligently to ensure profitability. Seeking ways to reduce these costs can help in sustaining the business.

T M Lewin

T M Lewin, established in 1898, was a well-known shirtmaker operating over 150 shops worldwide. It transitioned to an online-only model in 2020.

The company fell into administration for the second time due to challenges caused by the decline in formal shirt purchases during the pandemic. It was bought by US-owned Torque Brands, and continues to trade.

Main consideration for small businesses: What we can learn from T M Lewin here is that just because a company is long-established does not necessarily shield and protect it forever. While the pandemic was not their fault, a good business continuity plan could have informed them on what to do, or potentially what other items could have been pushed forward in their sales operations that would have made sense at the time to keep customers happy and their business afloat.

Trinity Group

Trinity Group, a company that owned the historic Savile Row tailor Gieves & Hawkes, fell into administration at the beginning of 2023. The brands under Trinity Group have now become subsidiaries, and efforts are underway to sell these assets to repay Trinity’s creditors.

Trinity Group’s administration came after unsuccessful attempts to find a buyer for Gieves & Hawkes. The company’s financial difficulties led to the decision to enter administration, with the aim of securing the best possible outcome for its creditors. The sale of the subsidiary brands is expected to generate funds to repay the outstanding debts.

Main consideration for small businesses: It is a good idea to regularly assess your financial position and explore potential buyers or partnerships to ensure long-term stability. When facing financial challenges, seeking professional advice and taking proactive measures such as restructuring or asset sales, can help mitigate the impact on creditors.

Bon Accord

Bon Accord shopping centre, located in Aberdeen, Scotland, had been a well-established retail destination. It provided a range of shops and services to the local community.

The owners of Bon Accord, Aberdeen Retail 1 Ltd and Aberdeen Retail 2 Ltd, faced cash flow problems and appointed administrators from Azets in September. While the owner went into administration, the shopping centre continued to operate as usual. The administrators aimed to find a buyer for the property. Bon Accord had undergone ownership changes throughout its history.

Main consideration for small businesses: Small businesses should prioritise financial management and cash flow planning to avoid financial issues that could lead to bankruptcy. Building a stable customer base and adapting to market changes can also help sustain success in the long run.

Internet Fusion Group

Internet Fusion Group is a global ecommerce retailer specialising in action sports products. It owns several brands, including Surfdome, Country Attire, and Rideaway, catering to the surfing, skiing, skating, and equestrian activities market.

They went into administration in 2022 and were subsequently acquired by BrandAlley. BrandAlley purchased the intellectual property, brands, logistics, and customer services division of Internet Fusion Group. 

However, it did not buy the existing stock and chose not to sell from Internet Fusion Group’s domains. As a result, 100 Internet Fusion Group staff members were made redundant.

Main consideration for small businesses: This is a challenging time, especially in the ecommerce market – and so adaptability to changing market conditions is important. You could focus on diversifying your sales channels, maintaining a strong online presence, and considering strategic partnerships or acquisitions to enhance their competitiveness.

David’s Bridal

David’s Bridal is the UK arm of a US-based bridalwear chain. It specialises in offering bridal gowns and related accessories. The company operated both physical stores and an ecommerce platform.

Following the collapse of its US owner, David’s Bridal went into administration. The US owner planned to make 9,000 redundancies in North America. In the UK, David’s Bridal continued to trade, but the company’s profitability had declined since 2018. The UK branch had 150 employees.

Main consideration for small businesses: Small businesses should be prepared for potential challenges in the wedding industry during times of economic uncertainty. You could focus on diversifying their product offerings, partnering with other companies to make your packages more appealing (wedding car rental companies, for example) and potentially exploring new revenue streams in order to mitigate risks, and to provide more affordable options for customers with lower budgets.

Book Depository

Book Depository was an online retailer that specialised in selling a wide range of second-hand English-language books. It had gained popularity among book lovers worldwide and was known for its extensive collection.

Amazon acquired the company back in 2011. But, the decision was made to discontinue its operations in April 2023, and Book Depository was closed down as part of Amazon’s downsizing efforts. 

Main consideration for small businesses: Downsizing can happen in anyone’s company and industry and is rarely anyone’s fault. However, there are certain ways you can potentially reduce the risk of this happening to your small business. Adapting to shifts in the industry and building unique value propositions can help you maintain a competitive edge against larger companies.

Kettle Interiors

Kettle Interiors was a furniture supplier and retailer based in Corby. It offered a range of furniture products to both businesses and individual customers.

They went into administration in March 2023 due to challenges posed by high shipping costs and uncertain deliveries, impacting their profitability.

Main consideration for small businesses: Small businesses involved in the furniture industry should closely monitor supply chain costs and delivery logistics. Exploring cost-effective or alternative shipping options such as dropshipping, building strong relationships with suppliers, and maintaining efficient inventory management can help them mitigate potential challenges and ensure profitability.

Maker&Son Ops

Maker&Son Ops was a luxury furniture manufacturer and retailer. The company underwent a process of liquidation in March, which affected its operations.

Main consideration for small businesses: Small businesses in the luxury furniture market should prioritise financial planning, ensuring they have adequate reserves to weather unforeseen challenges. Building a strong business continuity plan, delivering exceptional craftsmanship, and keeping a close eye on cash flow could help to save your business if it ever comes into financial struggles such as these.

ProBikeKit (PBK)

ProBikeKit (PBK) was a specialist retailer that offered a wide range of cycling accessories, clothing, and components. It served customers globally, both directly (B2C) and through business-to-business (B2B) channels.

PBK’s closure was part of the rationalisation efforts by its parent company, THG. Following reported losses in 2022, THG made the decision to close PBK and other cycling retailers under its portfolio.

Main consideration for small businesses: Despite this particular brand falling to the whims of their larger company cutting them loose, we still believe there is potential for businesses that offer bikes and cycling services at the moment. With rising energy bills making it cheaper to commute than to work from home, there is a market for sustainable transportation with a good return on investment. Maintaining strong relationships with suppliers, and continually adapting to consumer demands may help you thrive even in a competitive landscape.

Farmison & Co

Farmison & Co was an online retailer and wholesaler specialising in premium meat products. Based in Ripon, it offered high-quality meats to customers through its ecommerce platform.

In April 2023, Farmison & Co went into administration after failing to secure additional funding to continue operations. Unfortunately, the majority of its 75 employees were made redundant. However, there are plans for a consortium led by Andy Clarke to acquire and restart the business.

Main consideration for small businesses: To avoid a situation like this, your business could explore avenues for additional funding such as grants for small businesses, and ensure your business model is water-tight. 

Shuropody

Shuropody is a shoe and podiatry retailer that operates 39 stores. The company specialises in providing footwear and foot care solutions to customers. Shuropody plays a significant role in the market by offering a combination of retail and podiatry services, ensuring customers have access to comfortable and supportive shoes while addressing any foot-related issues.

Shuropody went into administration in December. However, the company was quickly bought by part of Baaj Capital on a pre-pack basis, saving hundreds of jobs. The stores continued to operate without any announced redundancies, providing stability to the employees and customers. With the acquisition, Shuropody aims to recover and continue serving its customers with quality footwear and podiatry services.

Main consideration for small businesses: This bankruptcy serves as a reminder that small businesses should prioritise financial stability. Additionally, maintaining strong relationships with suppliers and joint venture partners can be crucial for long-term success, especially when times get tough. By focusing on these key areas, SMEs can navigate uncertainties and improve their chances of sustainability in a dynamic market.

Stanton Bikes

Stanton Bikes is a mountain bike manufacturer and retailer based in Derbyshire. In November, the company went into administration and appointed joint administrators, Dean Nelson and Nick Lee of PKF Smith Cooper. Despite the administration, Stanton Bikes continues to trade as it searches for a buyer. The company’s focus on high-quality mountain bikes gained recognition in the market.

The company faced financial difficulties leading to its administration, triggered by a petition from a creditor to the high court. The impact of the administration includes uncertainty for the company’s future and potential job losses if a suitable buyer is not found.

Main consideration for small businesses: Maintaining a strong cash flow and exploring potential partnerships or investments can help you overcome challenges and avoid bankruptcy. Additionally, having that business continuity plan we mentioned earlier in place can provide stability during uncertain times.

Elite Sports Group

Elite Sports Group is a company that provides merchandise, retail services, and manages sports shops for various football clubs. The company went into administration in November, affecting its partnership with Danish company Hummel. Elite Sports Group served clubs such as Southampton, Millwall, Coventry, Newport County, Northampton Town, and Oldham, among others.

Elite Sports Group’s administration had an impact on the clubs it serviced. Coventry and Northampton Town temporarily closed their fan shops, while Southampton ended its agreement with Elite. The administration process may have caused disruptions and uncertainties for the affected football clubs and their fans.

Main consideration for small businesses: Small businesses should carefully manage their partnerships and contracts. In case of a partner’s financial difficulties, it is essential to have alternative arrangements to minimise the impact on operations. Maintaining open communication with partners and exploring diversified revenue streams can also help mitigate risks.

Click It Local

Click It Local, an East Suffolk online shopping scheme, entered administration at the end of March due to capital depletion. The company operated as a virtual high street, enabling shoppers to purchase from local independent or high street stores through a single payment platform with same or next-day delivery. 

Click It Local had active stores in Suffolk, Cambridgeshire, Essex, Brighton, London, and East Sussex.

Click It Local’s administration was a consequence of ongoing financial challenges and the depletion of available capital. Despite continuous efforts to secure support and capital over the past six months, the company was unable to sustain its operations. This led to the unfortunate decision to enter administration, affecting the services provided to local independent retailers and the convenience offered to customers.

Main consideration for small businesses: If you’re operating in the digital space, it is important to regularly assess your financial health and ensure sufficient capital reserves to sustain operations. Additionally, exploring various funding avenues and continuously evaluating the business model’s viability in the market can help you adapt to changing circumstances and maintain long-term sustainability.

Jupiter Group

Jupiter Group was a fruit supplier based in Newport, UK. The company played a significant role in the fruit supply chain, providing fresh produce to various markets.

They went into administration in early September due to supply chain issues and rising costs. As a result, the majority of the company’s 85 employees were made redundant. The remaining employees stayed on to assist with the administration process, while the administrators sought interested parties to purchase Jupiter’s assets.

Main consideration for small businesses: Prioritising building a resilient supply chain, monitoring cost fluctuations in your industry, and exploring opportunities to diversify revenue streams are all great ways to help mitigate the impact of unforeseen challenges.

Dawnfresh Seafoods and R R Spink & Sons

Dawnfresh Seafoods and R R Spink & Sons were UK-based suppliers of fish and seafood, operating fish farms and processing facilities.

The companies went into administration due to rising costs, overcapacity, and cash flow issues. Despite recent investments in upgrades, the challenges remained.

Main consideration for small businesses: Small businesses should carefully manage costs, assess market demand, and maintain a sustainable cash flow. Regular evaluation of capacity and market dynamics can help in avoiding overcapacity issues.

Tree of Life

Tree of Life was a health and lifestyle wholesaler operating in Newcastle-under-Lyme and Nottingham, UK. The company supplied various products to retailers in the health and wellness industry.

Tree of Life went into administration in August, resulting in 143 staff members being made redundant. Interpath Advisory was appointed as the administrator to oversee the process. However, 63 employees were retained to assist the administrators. The company faced financial challenges, leading to its bankruptcy.

Main consideration for small businesses: Health and wellness is a great industry with a wealth of potential in any economic landscape, if you do the right things.You should prioritise financial stability by closely monitoring your financial health and take proactive measures to address any potential challenges as soon as they arise. Diversifying their customer base and exploring strategic partnerships can also help mitigate risks.

Carzam

Overview: Carzam was an online car retailer headquartered in Peterborough, UK. It aimed to disrupt the automotive industry by offering an online platform for purchasing new and quality-condition used cars.

Carzam collapsed into administration just two years after its establishment in 2020. The company faced difficulties acquiring sufficient stock due to supply troubles and intense competition in the market for new models and quality-condition second-hand cars.

Main consideration for small businesses: Small businesses should carefully assess market conditions and competition before entering a disruptive industry. Building strong supplier relationships and ensuring efficient inventory management can help mitigate supply chain challenges and sustain growth.

Studio Retail Group

Studio Retail Group was an online retailer based in Lancashire, offering clothing, homeware, electricals, and gifts. It had a significant customer base of 2.5 million.

The company went into administration in mid-February 2022. Frasers Group, owned by Mike Ashley, bought Studio Retail Group for £1 and promised to invest £100 million in the business, saving around 1,500 jobs.

Main consideration for small businesses: Be aware of the challenges faced by online retailers, such as the intense competition, and the need to adapt to changing market conditions rapidly and efficiently. A good way to do this is to ensure that yourself as a business owner and your team are up to date with your online marketing skills – don’t fall foul to the digital skills gap.

Connect Distribution Services

Connect Distribution Services operated as an online distributor of spare parts, accessories, and consumables, primarily catering to DIY appliances.

In 2023, Connect Distribution Services went into administration, and its assets were subsequently acquired by Screwfix. The employees of Connect Distribution Services transitioned to the new owners.

Main consideration for small businesses: Small businesses in the distribution sector should proactively seek partnerships and collaborations to enhance their offerings and expand their customer base. Prioritising operational efficiency, investing in reliable inventory and project management software, and maintaining strong relationships with suppliers and customers will help you thrive in a competitive market landscape.

J C Rook and Sons

J C Rook and Sons was a family-run Kent-based butcher with a chain of 11 stores and an online business.

The company went into administration, closing all its stores and the online business. The decline in trade caused by the COVID-19 pandemic was cited as the reason.

Main consideration for small businesses: Small businesses need to be resilient and prepared for disruptions such as pandemics. Exploring online sales channels and ads (Facebook ads or Instagram ads for example) may help in boosting sales and recovering from the impact of such crises.

Steptronic Footwear

Steptronic, a luxury footwear brand known for its presence in over 3,000 high street stores worldwide, went into administration in March 2023. The Rushden-based business, in addition to its physical retail presence, also operated its own direct-to-consumer website. Business advisory firm Kroll was appointed as the administrator, following supply chain challenges.

Steptronic’s administration had repercussions for its retail operations and supply chain. The company faced difficulties in managing its supply chain, which likely impacted its ability to meet customer demand and fulfil orders. The appointment of an administrator aimed to oversee the restructuring process and explore options for the company’s future.

Main consideration for small businesses: Robust supply chain management systems are essential for running an optimal business – as well as assessing your operational efficiency. Understanding and addressing potential challenges in the supply chain can help prevent disruptions to production and fulfilment, ensuring consistent customer satisfaction.

Big Home Shop and Physioroom

Burnley-based retailers, Big Home Shop and Physioroom, experienced collapse in January. Big Home Shop specialised in selling garden furniture, outdoor equipment, and other furniture items through platforms like Amazon. 

The company cited shipment delays from China and the inability to secure additional finance from lenders and creditors as factors affecting sales and costs. 

Physioroom, an online retailer of home exercise and injury protection equipment, relied on Big Home Shop for several services.

The bankruptcy of Big Home Shop had a direct impact on Physioroom due to their interdependence. The challenges faced by Big Home Shop, such as shipment delays and financial constraints, ultimately led to the closure of both businesses. The inability to secure necessary funds and maintain smooth operations resulted in their downfall.

Main consideration for small businesses: Diversifying suppliers, exploring funding options, and monitoring market conditions can help mitigate risks and maintain business continuity.