Stevenage Bargain Buys threatened as Poundworld enters administration
Jun 12 2018
With others sharing sympathy for the staff.
Poundworld, which is owned by TPG Capital, has around 350 stores, including one on Tavern Street in Ipswich as well as stores in Chelmsford and Kings Lynn.
Administrators Deloitte say the retailer will continue to trade while a buyer for all or part of the business is sought. Unfortunately, this has not been possible'.
Poundworld's collapse comes after electronics chain Maplin and Toys R Us - each with Stevenage sites - both went into administration this year.
It sells 8,000 products, mostly priced at £1, including groceries, toiletries, household cleaning goods and candies, but has been hit rising costs and stiff competition.
A spokesman for TPG said putting the business into administration was a "difficult decision". We invested in Poundworld because of our belief in how the company serves its customers and the strength of its employees'.
"Despite investing resources to strengthen the business, the decline in United Kingdom retail and challenging behaviour affected Poundworld significantly".
Dave Gill - Usdaw's national officer, said: "We are seeking urgent talks with the administrators to represent the best interest of our members and urge them to find a buyer for the company".
Other parties named as possible buyers were turnaround specialist Alteri Investors and Poundworld's founder Chris Edwards.
In 2016-17, losses for the financial year were £17.1m, up from £5.4m the year before.
The news comes after a tough week for retail which saw department store giant House of Fraser announce it was to close more than half of its store estate amid hard trading conditions.
"Like many high street retailers, Poundworld has suffered from high product cost inflation, decreasing footfall, weaker consumer confidence and an increasingly competitive discount retail market."
Restaurant businesses have also been looking to cut costs with store closure programmes, with Carluccio's, Byron and Prezzo all implementing CVAs.