RISKY BUSINESS
High street fashion chain ‘on the brink’ of administration putting future of 60 stores in doubt
It comes after 27 retailers went bust in 2024 - see the full list below
A HIGH STREET fashion chain with 60 stores is on the brink of collapse.
Struggling retailer Quiz Clothing is set to call in administrators just days after its shares were removed from the London Stock Exchange.
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The company which is known for its partywear has struggled in recent years, and is expected to appoint Teneo as early as next week reports.
The move is expected to involve a pre-pack administration deal, allowing the chain's founders to regain control of a slimmed-down version of the business.
A "pre-pack administration" is an insolvency process for a business to sell its assets before appointing administrators. It's a way of selling a business to a third-party buyer.
Quiz currently employs approximately 1,500 people across its 60 standalone stores and numerous concessions.
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The restructuring under new ownership will mean the company can keep going, but is likely to involve some store closures and job losses.
Quiz Clothing stores currently remain open for business as usual, and customers can continue to shop online without interruption.
The retailer has faced difficulties for some time.
However, its precarious position worsened in December when reports emerged that its lender, HSBC, had engaged restructuring experts, signalling a potential crisis for the fashion chain.
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The retailer, best known for its women's party fashion ranges, warned at the start of December that a "significant reduction in revenues" could lead it to run out of cash in the new year.
The business has already gone through one restructuring in 2020 after going in to administration and renegotiated its rents as lockdowns damaged retailers.
RETAIL MISERY
Since the beginning of December 2024, Quiz Clothing's value has plummeted by 50%.
What does going into administration mean?
WHEN a company enters into administration, all control is passed to an appointed administrator.
The administrator has to leverage the company's assets and business to repay creditors any outstanding debts.
Once a company enters administration, a "moratorium"; is put in place which means no legal action can be taken against it.
Administrators write to your creditors and Companies House to say they've been appointed.
They try to stop the company from being liquidated (closing down), and if it can't it pays as much of a company's debts from its remaining assets.
The administrator has eight weeks to write a statement explaining what they plan to do to move the business forward.
This must be sent to creditors, employees and Companies House and invite them to approve or amend the plans at a meeting.
A Notice of Intention is used to inform concerning parties that a company intends to enter administration.
It is a physical document which is submitted to court, usually by directors aiming to prevent a company from being liquidated.
Like with a standard administration process, a Notice of Intention stops creditors from taking out any legal action over a company while they try and rectify the business.
Shortly before delisting from the stock market in a cost-saving measure, its market capitalisation had dwindled to a mere £3.6million.
Quiz Clothing, Teneo and Interpath have all been contacted for comment.
Quiz's difficulties reflect a broader crisis engulfing the UK retail sector.
Several other prominent retailers are also facing challenges, including Poundland's parent company which is exploring strategic options with advisors.
Lakeland has been put up for sale, and The Original Factory Shop nearing a sale to Baaj Capital.
Last week, WHSmith revealed it is looking to sell all 500 high street stores.
The retail group has been in negotiations with several prospective buyers of the high street division for several weeks.
The Sun revealed yesterday that advisers working for WHSmith have been in discussions with Doug Putman, the Canadian entrepreneur who rescued HMV from bankruptcy in 2019.
It is hoped that a deal can be reached within three months, according to sources.
Which retailers went bust in 2024?
During 2024, 27 retailers of all sizes went bust, affecting 886 shops and 17,939 employees, according to the Centre for Retail Research.
The number of casualties is more than half the previous year’s rate of retail collapses when 61 chains failed and 971 shops were impacted.
Here, we explain some of the biggest retailers that got into trouble in 2024...
Sook
Sook was one of the first retail casualties of 2024 and was particularly depressing as it was meant to be the answer to empty high street stores.
The business operated 12 pop-up shops across the country in London, Birmingham, Southampton, Liverpool, Newcastle and Leeds and made high street space available for online brands like TikTok.
Tile Choice
Tile Choice, a Midlands-based flooring retailer with 18 shops, went into administration in January 2024.
Nine stores were snapped up by rival Tile Giant but the rest were not saved.
The business had 116 staff and £16million turnover in the last financial year, but had struggled with a slowdown in spending.
LloydsPharmacy
LloydsPharmacy, once the UK’s second biggest community pharmacy chain, went into liquidation in late January with debts of £293million.
Why are retailers closing shops?
EMPTY shops have become an eyesore on many British high streets and are often symbolic of a town centre’s decline.
The Sun's business editor Ashley Armstrong explains why so many retailers are shutting their doors.
In many cases, retailers are shutting stores because they are no longer the money-makers they once were because of the rise of online shopping.
Falling store sales and rising staff costs have made it even more expensive for shops to stay open.
The British Retail Consortium has predicted that the Treasury's hike to employer NICs from April 2025, will cost the retail sector £2.3billion.
At the same time, the minimum wage will rise to £12.21 an hour from April, and the minimum wage for people aged 18-20 will rise to £10 an hour, an increase of £1.40.
In some cases, retailers are shutting a store and reopening a new shop at the other end of a high street to reflect how a town has changed.
The problem is that when a big shop closes, footfall falls across the local high street, which puts more shops at risk of closing.
Retail parks are increasingly popular with shoppers, who want to be able to get easy, free parking at a time when local councils have hiked parking charges in towns.
Many retailers including Next and Marks & Spencer have been shutting stores on the high street and taking bigger stores in better-performing retail parks instead.
In some cases, stores have been shut when a retailer goes bust, as in the case of Carpetright, Debenhams, Dorothy Perkins, Paperchase, Ted Baker, The Body Shop, Topshop and Wilko to name a few.
What's increasingly common is when a chain goes bust a rival retailer or private equity firm snaps up the intellectual property rights so they can own the brand and sell it online.
They may go on to open a handful of stores if there is customer demand, but there are rarely ever as many stores or in the same places.
The Centre for Retail Research (CRR) has warned that around 17,350 retail sites are expected to shut down this year.
The previous year it had closed all of its pharmacies inside Sainsbury’s and divided its 1,000 pharmacy estate into packages of hundreds of stores that it then sold to rivals in smaller deals.
There are no more LloydsPharmacy-branded sites on the high street, but it continues to operate online.
The Body Shop
The Body Shop filed for shock administration in February, just four months after being taken over by restructuring firm Aurelius.
Administrators immediately closed 75 of its 198 UK stores and made cuts to its head office while its international divisions were also declared bankrupt.
It took seven months for a rescue to be sealed with British cosmetics tycoon Mike Jatania in a deal that has kept 113 shops trading.
Matches Fashion
Matches Fashion, the designer clothing online retailer, was put into administration in March, less than three months after it was bought by Mike Ashley’s Frasers Group.
Frasers Group bought the business for £52million but said it was too heavily loss-making to turn around and closed it down.
The firm was founded 30 years ago by husband and wife team Tom and Ruth Chapman, who made £400million when selling the business to private equity firm Apax in 2017.
Ted Baker
Designer clothing and accessories brand Ted Baker initially filed for administration in April after the company that ran the brand in the UK also went bust.
At the time, Ted Baker had 46 shops in the UK employing around 975 people.
The business had been taken private by US firm Authentic Brands Group in a £211million deal.
The last stores shut in August after failing to secure a full rescue. It was relaunched as an online brand in the UK and Europe after a partnership with United Legwear & Apparel Co.
Muji
Japanese brand Muji, which had six stores in the UK including five in London’s busiest shopping streets, went into administration at the end of March.
The retailer had been popular with shoppers who liked its minimalistic stationery and homewares.
It was saved after a rescue deal with its parent company.
Carpetright
Flooring retailer Carpetright filed for administration in July after efforts to turnaround the struggling firm were derailed by a cyber attack.
The business had 1,800 staff and 273 shops across the country before going bust.
Around 54 stores were snapped up by its arch-rival Tapi Carpets & Floors, which also bought its brand name and continues to run the brand online.
The Floor Room
The Floor Room was owned by the same parent company behind Carpetright, Nestware Holdings.
The business traded out of 34 John Lewis concessions and employed 201 people.
The firm also relied on Carpetright for a number of its essential customer support services and could not survive on its own.
Homebase
DIY chain Homebase collapsed in November after years of struggles.
The business had around 130 shops across the UK and had been owned by restructuring firm Hilco, which bought the business for a single £1 in 2018.
Australia’s Wesfarmers had briefly owned Homebase in a disastrous attempt to break into the UK market.
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Westfarmers bought Homebase in 2016 after Sainsbury's £1 billion purchase of Argos triggered a break-up of Home Retail Group.
The brand and some stores have been partially rescued by billionaire Chris Dawson, the owner of The Range and Wilko.
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