Case Study: Bennetts (Irongate) Limited - Administration
Multi-site department store in trading administration
Bennetts (Irongate) Limited traded reputedly as the "oldest department store in the world" on Irongate in Derby. The company also had a store in Ashbourne. The business, family owned for 30 years, had a loyal customer base but in recent years had suffered from the perfect storm of weakening consumer confidence, increasing competition from online retailers and escalating costs.
By January 2019 the company found itself in an insolvent position, with significant lease liabilities and no cash with which to order stock. The directors appointed Paul Mallatratt and Louise Freestone of Bridgewood as Joint Administrators on 8th February 2019.
Bridgewood traded both stores whilst a buyer was sought for the sites. Extensive use was made of the Press and social media, leveraging the Derby store's iconic status, which attracted a number of interested buyers as well as driving increased footfall and sales in both stores.
A small number of redundancies were made on day one, including the directors/senior management. The business continued to trade well, allowing the Joint Administrators sufficient time to secure a sale of the Derby site, which was agreed in principle at the end of April and completed on the 20th June.
Unfortunately a buyer for the Ashbourne store could not be secured and after 8 weeks of trading in administration the decision was taken to close this store down. Working closely with staff the Joint Administrators were able to sell 95% of the stock for cost price or better.
The combination of good trading income plus the sale of the Derby store's assets has ensured creditors will receive a good dividend, as well as preserving 27 jobs and the brand.
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We are very pleased to have agreed a sale in principle of the business, particularly in such a difficult retail climate. This will ensure the iconic Bennetts brand continues to have a strong presence in Derby.
Bridgewood is a trading style of Bridgewood Financial Management Limited (Company No: 07130329) and Bridgewood Financial Solutions Limited (Company No: 06957765). Registered Office: Poynt South, Upper Parliament Street, Nottingham, NG1 6LF. Registered in England and Wales.
Calls are recorded for training and security purposes.
Paul Mallatratt (Licence No. 2039) and Louise Freestone (Licence No. 2030) are licensed to act as insolvency practitioners in the UK by the Institute of Chartered Accountants in England and Wales and are subject to their Code of Ethics, available in English at www.icaew.com[...]code-of-ethics-d
In carrying out the regulated profession of Insolvency, the firm is subject to the Insolvency Regulations and Guidance Notes at www.icaew.com/insolvency and the Statements of Practice at www.icaew.com[...]insolvency-regulations-and-standards