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UK's biggest high-street camera store enters administration
The UK's biggest high-street camera retailer, Jessops, has gone into administration, putting 192 stores and 2,000 jobs at risk. The company's website is not accepting orders and administrator PricewaterhouseCoopers has said vouchers and returns would not be honoured at present. The company, that has been slow to respond to competition from internet retailers, was rescued in 2009 by HSBC, which bought into the company in return for writing off some of its debts. However, increasingly stringent credit terms imposed by suppliers (a common move when there is doubt surrounding the future of a company), and predictions of further falls in camera sales led to the administrators being called.
The move follows the collapse of the country's largest independent photographic chain, Jacobs, in June 2012.
PricewaterhouseCoopers Press Release:
The Jessop Group Limited – in administration (“Jessops or the Company”)
Edward Williams, Rob Hunt and Matthew Hammond of PwC were appointed joint administrators of The Jessop Group Limited on 9 January 2013.
Jessops is a major high- street retailer of photographic equipment and growing on line business. Turnover in the year to 31 December 2012 was £236m and Jessops operated from 192 stores with around 2000 employees throughout the UK. It has a well-known brand, strong reputation for service
and a significant national footprint.
However, its core marketplace has seen a significant decline in 2012 and forecasts for 2013 indicate that this decline would continue. In addition, the position deteriorated in the run up to Christmas as a result of reducing confidence in UK retail. Despite additional funding being made available to the company by the funders, this has meant that Jessops has not generated the profits it had planned with a consequent impact on its funding needs. This was exacerbated by a credit squeeze in the supplier base.
Rob Hunt, joint administrator and partner, PwC said:
“Over the last few days the directors, funders and key suppliers have been in discussions as regards additional consensual financial support for the business. However these discussions have not been successful. In light of these irreconcilable differences the directors decided to appoint
administrators and we were appointed earlier today.
“Our most pressing task is to review the Company's financial position and hold discussions with its principal stakeholders to see if the business can be preserved. Trading in the stores is hoped to continue today but is critically dependent on these ongoing discussions. However, in the current economic climate it is inevitable that there will be store closures.”
Finally, at present Jessops is not in a position to honour customer vouchers or to accept returned goods.