Firm may collapse as retail sector hits crisis point
JOBS are at risk as drinks firm Conviviality announced it is set to go into administration.
The owner of Bargain Booze is planning to appoint administrators within the next 10 business days ‘unless circumstances change’, putting 2,500 jobs at risk.
The discount store has three stores in Portsmouth – North End, Cosham and Southsea.
The company will keep working alongside advisers and said it is exploring ‘a number of enquiries regarding a potential sale of all or parts of the business’.
‘Following discussions with its lending banks, the board has resolved to file notice of intention to appoint administrators to the company,’ Conviviality said in a market announcement.
‘Unless circumstances change, and in accordance with statutory requirements, the board intend to appoint administrators within 10 business days.’
The company’s collapse would cap a nightmare quarter for the retail sector as, since January, Toys R Us and Maplin have filed for administration, while fashion retailers such as New Look and Select have embarked on radical store closure programmes.
Prezzo, Byron and Jamie’s Italian have also shut restaurants and culled hundreds of jobs.
Federation of Small Businesses development manager for the region Neil Eames said: ‘Businesses are facing mounting pressures, particularly in the retail sector due to their reliance on property.
‘Many businesses are hit by increases in business rates as well as rising rents.
‘Retail firms are also disproportionately likely to feel the impact of rise in national living wage and auto-enrolment pensions next month (April), as they are labour intensive.
‘Small businesses and retailers are hugely important not just to the community living and working in an area, but to the local economy.
‘In the face of mounting pressures, small businesses and independent retailers are constantly having to diversify in order to grow.’
Head of policy and representation at Hampshire Chamber of Commerce Mark Baulch said: ‘The retail sector has always been a fast-moving environment and is experiencing a significant period of change as consumer habits alter. Retailers that embrace this change and have invested in on-line options as well as creating experiences in their stores will continue to have a place.
‘Others will have to re-invent themselves or face similar difficulties to some of the businesses that we have seen falter and fail recently.
‘These events have always been cyclical and so we are seeing the re-setting of the High Street towards new consumer demands.’