Closing down sale at Robbs in Hexham (30 May 2010)

As the uncertainty over the future of the Vergo Retail store empire continues, potential suitors for some of the stores are starting to emerge. Here are the latest happenings…

In Liverpool’s Ranelagh Street, Lewis’s department store closed for good at the end of trade yesterday, bringing an end to a 154-year-old institution. Its closure had already been announced in February, prior to Vergo’s administration, to allow for the redevelopment of the iconic Lewis’s building. I hope to cover the history of Lewis’s in more detail in a future blog.

Of the remaining stores, the administrators MCR have already closed one, in Dovercourt, while closing down procedures are now underway at the other 18. However, MCR have confirmed that “discussions are ongoing with a number of different parties wishing to acquire part or all of the business”. As far as I understand, firm closure dates are yet to be announced for any of the remaining stores; certainly, when I walked past Robbs in Hexham yesterday it had the ubiquitous ‘Store Closing’ signs up, but not yet the dreaded countdown announcing the number of days left before closure. 

Coverage in the Hexham Courant, 28 May 2010

Following the earlier news that department store operator Beales had lodged “formal notice of interest” in buying Robbs, the front page of Friday’s Hexham Courant reports that the deal “could soon be clinched”. Beales’ Chief Executive Tony Brown has apparently visited Robbs, and is quoted as saying that his company is “continuing to pursue” its interest, and is “still in talks with both the landlord and the administrators”. For the third week in a row, there’s also a quote from someone called Graham Soult… I guess he’d better enjoy the exposure while it lasts!

The potential Beales takeover has also been noted by Drapers, writing that “independent department store chain Beales has been linked to a number of the higher profile stores such as Robbs of Hexham and Derrys in Plymouth.” 

Store closing banner at Robbs (30 May 2010)

On that subject, The Herald newspaper in Plymouth quotes local entrepreneur Chris Dawson – owner of The Range chain of home, garden and leisure stores – as saying that he is “interested in a few of the stores, parts of the group and all of the stock”, the implication being that he may step in to take over Derrys in Plymouth or – perhaps more likely, given The Range’s lack of a fashion offer – some of the South West-based Homemaker stores.

Described by Retail Week as “colourful”, Dawson’s record of buying up the stock of collapsed retailers such as Empire Direct and MFI is not to everyone’s taste, recognised in him jokingly styling himself as the “grim reaper”. However, it’s difficult to argue with Dawson’s success as a retail entrepreneur, with The Range now expanded to 46 stores (up from 33 in February last year) including its first in the North East, recently opened up in the former Big W unit in Portrack Lane, Stockton-on-Tees.

As yet, I’m not aware of any particular rumours involving Vergo’s stores in the east of England. However, the Norwich Evening News has reported on how Vergo’s collapse has affected one local couple who had paid £900 for bedroom furniture from the Norwich department store, but who may not now receive their order or their money back.

They are, unfortunately, far from alone – the Evening News’s story very much echoes an email that I received from Tony, asking what he should do about the £500 pram that his daughter had ordered and paid for from Derrys in Plymouth, but not received.

As I suggested to Derek, the best place to start if you are an outstanding customer of Vergo Retail is to visit the Vergo page of the MCR website, which includes advice on how to proceed, including a downloadable ‘Outstanding Orders Form’.

Ethel Austin, Bishop Auckland

Reports that value fashion retailer Ethel Austin and its sister homewares business, Au Naturale, are poised to enter administration – less than two years after both chains were rescued from previous administrations - is sad and disappointing news, as well as being quite surprising in its timing. 

True, there has been talk of an impending refinancing deal for a week or two, following suppliers’ alleged complaints about not having received payments that were due before Christmas. However, the retailer had reportedly “vehemently denied that it was in trouble”, and has recently been opening stores at quite a pace – 30 to 40 in the last few months, according to the Independent. 

Indeed, as recently as last week Ethel Austin was announcing new store openings, its planned move into the former Woolworths premises in Carmarthen following its acquisition of more than 20 other Woolies sites nationwide over the last twelve months, such as Huddersfield, Fishponds in Bristol, Stone in Staffordshire, and Leven in Fife. 

Ethel Austin store, Byker

I can’t recall ever entering an Ethel Austin store, so it’s difficult for me to comment on what might have gone wrong, though it’s fair to say that many of the more established shops that I have spotted – in places such as Byker or Seaham – haven’t occupied great locations. I’ve always quite liked Au Naturale though, and was disappointed to hear only this week that its Washington Galleries store was closing down. Its stock is largely cheap and cheerful, but it’s always been a good place to go for reasonably priced, decent quality home accessories such as cushions, baskets, vases and coasters. 

Hopefully, whatever fate awaits Ethel Austin and Au Naturale, the future of as many stores and jobs as possible can be secured. However, as with childrenswear retailer Adams – currently in administration for the third time in three years – you do have to question how far a business that has repeatedly collapsed into administration is really worth saving. It suggests, surely, that something is fundamentally awry with the business model or brand. 

Indeed, think about those retailers that have been rescued from administration in recent years, and it’s much easier to bring to mind those that have later collapsed again – such as MK One, MFI and, only this week, jewellery retailer Diamonds & Pearls – than it is to think of any chain that has truly gone on to thrive. Little wonder, perhaps, when retailers are so often bought out of administration – in a pre-pack or otherwise – by the same individuals who took them into administration in the first place.