Special Report: Administration

As the recession begins to bite and customers stop spending more firms are falling into administration.

Already several big high-street names have fallen and experts predict more will fall in 2009 as the recession continues. In this special report we go through those firms that have already gone into administration. Updated: 05/01/09.

As the recession begins to bite and customers stop spending more firms are falling into administration. Already several big high-street names have fallen and experts predict more will fall in 2009 as the recession continues. In this special report we go through those firms that have already gone into administration.

Woolworths: Perhaps the most obvious choice to start with but the collapse of Woolworths and its distribution arm, Entertainment UK, has had a profound effect on several other companies. Woolworths other company, 2|Entertain, is likely to be bought by BBC Worldwide, who already own shares in the DVD company.

A buyer for Woolworths however, hasn’t been forthcoming with companies only taking an interest in individual stores rather than the company as a whole. The company’s stores have now begun to close down and all stores will be shut by January 5th. Customers have flogged back to the store in recent weeks as they bargin hunt as Woolworths has to sell everything, including the stores fixtures and fittings. Woolworths had over 800 stores across the UK.

Zavvi: Fell into administration on Christmas Eve and came as something of a shock to the stores customers. The collapse of Woolworths and its distribution arm, Entertainment UK, left Zavvi with stock storages and it stopped taking orders from its website for Christmas. However, this wasn’t seemingly enough to deal with Zavvi’s stock problems and on Christmas Eve the company went into administration, it has over 125 stores across the UK.

The company is trading as normally at present as a buyer is sought but the decision not to accept gift cards or vouchers has prompted anger from some as many were purchases as Christmas gifts.

MFI: Went into administration in November and by Christmas all of its stores had closed meaning job losses of over one thousand. MFI had been struggling for some years due to tough competition from the likes of Ikea MFI had over 100 stores across the UK.

The Officers Club: A victim of the economic downturn, The Officers Club, fell into administration on Tuesday 23rd December. However, the company has been sold to TimeC 1215 and 118 stores, of the 150 Officers Club stores, will remain open under the deal. 32 stores have, however, closed.

Whittard of Chelsea: Another victim of tough trading circumstances and stiff competition from its rivals. Although the company went into administration shortly before Christmas it was quickly snapped up by a private equity firm. For now all of the company’s stores will remain open and the deal also secures, for the time being, the 950 people the company employs.

Olan Mills: A photographic studio company mainly based in Northamptonshire but also operating studios within some Mothercare stores. The company stopped trading on Boxing Day and will be put into administration. The company had 34 studios in England and Wales.

Morgan: French based women’s clothing store which has stores across 57 countries, including the UK and Ireland. Although the store has over 500 stores of which 33 are in the UK/Republic of Ireland. Morgan has been looking for a buyer for the company since the start of 2008 and although it’s now gone into administration its hopeful a buyer will come forward and snap it up.

Adams Kids: While children’s clothing stores Adams have yet to go into administration, at the writing of this article, it’s highly likely they will do. Creditors have begun action against the struggling company and experts have predicted the company is likely to go into administration. On Christmas Eve the company filed a notice of intention to appoint administrators, which expires on January 2nd, but Adams is still hoping to avoid falling into administration.

Updated: Adam Kids has now gone into administration, bringing in administrators on New Year’s Eve. At present all 231 Adams stores will remain open while administrators take control and decide on which branches will be closed. Updated 05/01/09: Five days after calling in the administrator 111 Adams stores were closed down with 850 staff losing their jobs. Administrators are looking to sell off the remaining 160 stores.

Waterford Wedgewood: On January 5th it was announced that iconic chain/ceramics company Waterford Wedgewood had fallen into administration. Poor trading conditions and failed talks over a buyout resulted in the firm falling into administration. The company has also suspended its shares on the Stock Market. It’s likely however, despite the company’s current difficulties a buyer will probably be found because of its history and brand name.

Passion for Perfume: The Manchester based Passion for Perfume announced on January 5th it had gone into administration and all 45 stores, across the UK, had closed effectively immediately. The collapse of the retail chain meant 194 staff lost their jobs although the administrators stated all staff had been paid in full. The administrators are now seeking a buyer for the business and/or its assets.

 This special report was updated in January 2009.