ICSM Business News: the reasons why so many firms are collapsing as Made.com is the latest big name to go into administration

ICSM Business News: the reasons why so many firms are collapsing as Made.com is the latest big name to go into administration

By Harry Mottram: Online retailer Made.com has called in administrators from accounting firm Pricewaterhouse Coopers after days of speculation over profit warnings and a collapse in the Shoreditch based firm’s share price plus a failure to secure £70 million pounds to secure its future. Earlier this year the firm predicted a small profit but now the collapsed company is laying off its 700 staff, stopped taking orders and faces a £35 million pound debt mountain.

Whether the administrators can find a buyer is open to speculation as the home furnishing market has been hit by the Cost of Living Crisis as customers cut back on spending. Eve Sleep of Camden who make mattresses went bust last month owing the taxman £400,000, along with Complete Carpets Limited, Furniture Loft Limited and Optimal Furniture Limited.

The reasons also include servicing debt as with a hike in interest rates and double digit inflation the repayments to lenders become impossible to pay.

Other factors for the online firms include distribution with a shortage of drivers and logistic firms willing to take on work from firms in trouble due the fear of not getting paid compounds the problem.

For the high street retailers and out of town stores there is the continued problem of business rates stifling profits and preventing growth and their landlords in some cases increasing the cost of leasing.

During the Covid Pandemic online shopping became big business spurring the rapid growth of Made.com, but with a return to work customers can visit high street retailers again. Being able to take home your chosen chair or bedside table rather than wait months for it having paid up front.

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