The closure of the main street stores in the card and stationery chain before Christmas is at risk 1500 jobs

The card and stationery retailer Paperchase is about to take over the administration after the pre-Christmas shop closings “unbearably strained” the main street and 1Have put 500 jobs at risk

The 173-branch and concession company has filed a notice appointing administrators to put together a rescue Legal document provides 10 days of creditors protection

Paperchase has been particularly vulnerable to disruptions to sales caused by lockdowns in the run-up to Christmas, as 40% of the chain’s annual sales are in November and December. New restrictions mean all UK stores will be closed again in line with other non-essential retail stores are

A Paperchase spokesman said the cumulative effect of multiple lockdowns, including the loss of the pivotal Christmas trade in November, “put an unbearable burden on retailers across the country”

Despite strong online sales, Paperchase is not immune to the difficult environment “We have acted well out of lockdown, but with the country facing further restrictions in the coming months, we need to find a sustainable future for Paperchase”


The spokesperson added that the company “worked hard to find this solution,” with the administrative advisory being a “necessary part of that work” The auditing company PwC was hired for the process

“This is not the situation we wanted to be in,” added the Paperchase spokesperson. “Our team has been fantastic this year and we cannot thank them enough for their support”

The company was founded in 1968 by art students Judith Cash and Eddie Pond, who opened a store in the London borough of Kensington.The company has changed hands several times, with rival WH Smith and the now-defunct US book giant Borders among the previous owners of the Chain

In 2010, the private equity company Primary Capital supported a management buyout of 20 million GBP from Borders Primary Capital, which also owns Yo Sushi and Coffee Nation, attempted to sell Paperchase in 2014 and was considering an IPO two years later

In 2019, Paperchase took advantage of a bankruptcy process known as a Voluntary Corporate Agreement (CVA) to weed out unprofitable businesses and cut rents Branches are switched to sales-based rents, which means the company is not burdened with real estate costs as much as some retail chains

The last accounts show that the retailer has a turnover of 125 million GBP 11 million in the year to February 2019 GBP listed

Paperchase

World News – GB – UK bans bring Paperchase to the edge of administration

Source: https://www.theguardian.com/business/2021/jan/05/uk-lockdowns-push-paperchase-to-verge-of-administration