to be bought by Next group, 400 employees made redundant

The brand and intellectual property of the clothing retailer will be acquired by the British clothing group.

British clothing giant Next bought the brand from bankrupt furniture seller at a discounted price, with at least 400 employees out of a job. Made announced in a press release on Wednesday the appointment of three PricewaterhouseCoopers (PwC) directors to manage the liquidation, and they immediately entered into an agreement with Next to acquire Made’s brand, domain name and intellectual property, d ‘after a press release from the company and PwC. The latter also specified in a separate press release that it paid 3.4 million pounds for this transaction.

According to PwC, the company has 573 permanent employees, with warehouses in the UK and Belgium, in addition to offices and stores in London, Europe and Vietnam. “Unfortunately the transaction (with Next) does not take into account employees and it will result in the dismissal of 320 peoplein addition to 79 other employees who are leaving, PwC said. A PwC spokesperson contacted by AFP stressed that 100 employees outside the United Kingdom will be notified of their situation in the coming days, while 74 will remain employed by Next to ensure the transition. Administrators should try to monetize the remaining assets and “payments to creditors will be made according to their statutory priorities“, refers to the press release. “We are very disappointed to come this far.commented Susanne Given, president of Made. last week announced its intention to put itself into administration with a view to its liquidation, and the suspension of its action on the London Stock Exchange, which is due to be delisted. Known for its comfortable sofas in colorful velvet, the company founded in 2010 has suffered a sudden reversal of fortunes since its IPO in June 2021. Its market capitalization was then about 775 million pounds and its share price was 200 pence, the value went up in smoke. since.

An accumulation of losses

In September, the company that sells its furniture in the United Kingdom, but also in other European countries such as France, Switzerland, Belgium or Germany, announced that it was examining several strategic options to raise funds . At the end of October, he said he was delaying his negotiations with potential buyers and stopped taking new orders. the society”there was a boom in demand during the pandemic lockdown, when home renovations were in vogue“, but the tide is turning, commented Victoria Scholar, an analyst at Interactive Investors.

Added to this are supply chain issues that have dramatically increased delivery times, and a cost-of-living crisis that is driving households away from large purchases, he said. He noticed a trend among clothing giants such as Next and H&M to diversify furniture and decorations. For Next, capturing Made’s consumer base, which is younger than its own, is a long-term opportunity, said Richard Lim, managing director of Retail Economics, interviewed by AFP. But Made’s fate also illustrates “the stark poverty of the sectorof distribution, according to him.

After health restrictions were lifted, shoppers returned to stores more than expected, showing that the surge in e-commerce is more episodic than permanent. Made, which accumulates losses, also bases its business model on betting on stable and continuous economic growth, low interest rates. It’s a worldis gone» with the return of inflation, logistical difficulties and geopolitical turmoil, as pointed out by Nicola Thompson, the general manager of Made, who apologized to all those suffering from bankruptcy.

Orders that have been paid for but not yet shipped in particular will not be completed, PwC said, without saying whether customers will be paid. In a general way, “Retailers are currently facing a tidal wave of costswhich forces online stores to sometimes charge for deliveries or returns, which discourages certain orders, underlined Richard Lim. Sign of the times: the M&S chain of stores unscrewed the stock market on Wednesday after announcing a drop in its operating profits, eaten by “pressure on costs and prices“.

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