Mon, 12 Dec 2022 | ADMINISTRATION
Scottish high street clothing retailer M&Co has fallen into administration for the second time in just over two years. Administrators from Teneo said that the company had succumbed to a range of pressures currently impacting UK retailers, including rising costs and falling consumer confidence.
The company, which has 170 UK stores and employs 1,910 staff, appointed administrators on Friday and is now seeking to secure a sale “in an accelerated timeframe”. Administrators said that “no immediate redundancies” had been made and that the company’s stores and website would continue to trade.
Over the past week, the retailer has closed two stores in Dorchester, Dorset and Droitwich, Worcestershire. Commenting on the company’s collapse, administrator and Teneo Managing Director Gavin Park said: “Like many retailers, the company has experienced a sharp rise in its input costs, which has coincided with a decline in consumer confidence leading to trading challenges.”
Park said that, despite the retailer having “a very loyal customer base, particularly in local markets, and a well-recognised brand”, the headwinds affecting the retail sector amid rising costs and the cost-of-living crisis had exerted “increasing pressure” on its cashflow.
Park added: “No immediate redundancies have been made and the joint administrators are exploring a potential sale of the business in an accelerated timeframe, during which time the company will continue to trade from its stores and website.”
The company, formerly known as Mackays, previously fell into administration in August 2020 after it struggled to trade through the COVID-19 pandemic and associated lockdowns, which severely impacted high street footfall.
As part of that process, the company’s assets were immediately sold back to its owners the McGeoch family in a pre-pack acquisition that saw 47 of its stores close.
M&Co’s administration comes amid a wave of insolvencies in the UK retail sector. Last month, online furniture retailer Made.com fell into administration after being hit by global supply chain disruption. The company’s brand and intellectual property were ultimately sold to high street retailer Next for £3.4 million. In the same month, Next also acquired clothing retailer Joules in a pre-pack sale valued at £34 million.
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