PARENTING retailer Mothercare has announced plans to put its UK business into administration affecting local branches including Cardiff and Swansea.
The company said it will file a notice to appoint administrators, casting a shadow over the future of its 79 UK shops and 2,500 employees.
Mothercare has already gone through a company voluntary arrangement (CVA), which allowed it to shut 55 shops. The planned administration also affects Mothercare Business Services Limited (MBS), which provides certain services to Mothercare UK.
Mothercare said: “These notices of intent to appoint administrators in respect of Mothercare UK and MBS are a necessary step in the restructuring and refinancing of the Group. Plans are well advanced and being finalised for execution imminently. A further announcement will be made in due course.”
Only 500 of the jobs at risk are full-time posts, including head office roles, with 2,000 part-time.
The main branches expected to be affected in south Wales are Cardiff and Swansea, where many could become jobless at this sudden news.
Mothercare has been looking for a buyer for the UK stores, but with no success so far.
The company also operates in more than 40 overseas territories, which are not subject to administration. In the financial year to March 2019, Mothercare’s international business generated profits of £28.3m, whereas the UK retail operations lost £36.3m.
However, in its prime Mothercare had hundreds of stores. It was the go-to place for new parents but sadly it failed to keep up with the public’s changing shopping habits. Mothercare’s UK sector has been loss-making for years. One big reason is there’s so much more competition these days.
Here are some of the key moments in the decline of the well-known retailer:
1961 – Mothercare is founded by entrepreneurs Selim Zilkha and James Goldsmith.
1986 – The company becomes part of the Storehouse group after it merges with homeware business Habitat and British Home Stores.
2000 – The company reverts to the Mothercare brand after the BHS and Habitat businesses are each sold off separately.
June 2007 – The retailer purchases the Early Learning Centre chain of children’s stores for £85m. By now, Mothercare has grown to more than 350 outlets in the UK.
2017 – The retailer has seen a steady decline in sales following the financial crisis, resulting in a number of profit warnings and a steady stream of store closures. By November, the company has 152 UK stores and warns over the “softening UK market” as half-year losses widen on the back of sliding high street store sales.
May 2018 – Mothercare secures a Company Voluntary Arrangement (CVA) restructuring deal which it says will lead to the closure of 50 stores and affect 800 jobs. The retailer says it has also agreed rent reductions on another 21 stores as part of the move.
July 2018 – Mothercare announces a £32.5m fundraiser at 19 pence per share (more than double its current value) to gather proceeds to pay off its significant debts.
The company also says it will close more stores than previously indicated, forecasting a rise to 60 closures, although this eventually results in 55 sites shutting their doors.
December 2018 – The retailer sells and leases back its UK head offices, bringing in £14.5m, as sales continue to fall in its UK high street stores.
March 2019 – Mothercare announces plans to sell the Early Learning Centre toy business to rival retailer The Entertainer for £13.5m. The group says the sale is the “next step towards being free of bank debt”.
July 2019 – The children’s goods business issues a profit warning after it sees UK profit margins improve slower than forecast due to the difficult retail backdrop, despite the major restructuring and cost-saving efforts.
UK sales are decimated by the raft of closures, driving total UK sales down by 23.2% for the 15 weeks to July.
November 2019 – Mothercare’s parent business says it will file a notice to appoint administrators for the UK business as it can no longer “satisfy the cash needs” to keep it afloat.
New job market data has also revealed a downward spiral for the retail sector as a whole, with available vacancies in the retail sector plummeting by -25% in the last 12 months.
According to data from Adzuna, a leading job search engine, the retail industry has lost a quarter of all vacancies in the past 12 months (a loss of 7,298 jobs) with a -13% decrease of jobs month-on-month. August 2019 shows the largest month-on-month decrease since May 2017.
Splitting this loss out into different roles, the data reveals vacancies for management positions in retail have fallen by 30% compared to this time last year, with vacancies for retail apprentices dropping by 55% and retail operatives dropping by 23%.
The average salary across the industry (£26,284 pa), has only seen a 0.7% increase in the last three years, despite the average inflation rate being 2.62%¹. The current average sits 23% below the national average of £34,164.
The top five companies hiring for retail jobs in the UK are:
Tesco – 1,275 jobs
Dixons Carphone – 952 jobs
Halfords – 401 jobs
Greggs – 351 jobs
Sainsbury’s – 334 jobs
The data also looked at the job market at a whole, revealing that across all industries, the North East of England saw the biggest loss in job vacancies (-46.3% year on year) in the last 12 months.
Shares in the parent company Mothercare dived by 29.2 percent to eight pence in early trading on Monday amidst the tough retail climate and one thing is for sure, Mothercare’s days are numbered.
The Range’s Swansea Store Shortlisted for ‘Best Christmas Display’
Christmas has arrived early for The Range stores in Wales, boasting gigantic displays of all-things festive! The Range is well known for going all out during the Christmas season to create a fun and magical experience full of trees, lights, decorations and much more for their customers to enjoy and this year is no exception. The Range in Swansea surpassed expectations with a display so great, it’s left them shortlisted for ‘Best Christmas Display’ out of all The Range’s 182 stores.
Swansea Building Society unveils bespoke mortgage product for medical professionals
Following extensive consultation with mortgage brokers and customers, Swansea Building Society has unveiled a new mortgage product specifically designed to offer medical professionals enhanced terms and a better deal.
The Medical Professional Mortgage Product is designed specifically for cases where the applicant, or one of the applicants in the case of a joint mortgage, is a medical doctor, surgeon or dentist. They might be looking to purchase a property, re-mortgage from another lender, or raise capital against equity in a property.
This new product also allows customers to borrow a higher amount against their income compared with standard mortgage products, subject to meeting affordability rules. Sole customers will be able to borrow up to 5.5 times their sole income (the standard criteria is a multiple of 4.5) while joint customers will be able to borrow up to 5.0 times their joint income (the standard criteria is a multiple of 3.5).
The new product was made available to customers from October 1, 2020.
Alun Williams, chief executive of Swansea Building Society, said:
“We are constantly reviewing what we do based on feedback from customers, brokers and our wider analysis of the mortgage landscape to ensure we are competitive where relevant in the current market.
“In this case, we wanted to develop a product that would reflect the current and future earnings potential of some of our clients who work in the medical profession. We are delighted to be able to roll this product out; we have already had very good feedback from our network of brokers.”
Simon Mayo to join Swansea local radio
BAUER MEDIA is proud to today detail a new local initiative that Greatest Hits Radio and The Wave will launch within Swansea and South Wales aimed at helping local workers, charities and businesses as they deal with the economic impact of the Covid-19 pandemic.
Swansea Sound will lead the ‘Getting You Back to Work’ campaign, as it relaunches as Greatest Hits Radioin September. The scheme, which will also run across sister station The Wave, aims to promote local job opportunities both on-air and online. Local employers will be encouraged to submit vacancies for inclusion, allowing them to reach a wide audience of local job-seekers free of charge. Job vacancy bulletins will be broadcast four times a day to local audiences and will be promoted on the relevant Greatest Hits Radio and The Wave websites.
As Swansea Sound gets set to join the Greatest Hits Radio Network, it is also announced today that it will welcome esteemed broadcaster Simon Mayo to its line-up. The former BBC Radio 2 host currently hosts a daytime programme on Greatest Hits Radio’s classical sister station, Scala Radio. However, with this move he’ll be returning to his popular music roots as he presents a new weekend show. ‘The Album Show with Simon Mayo’ will be a weekly three-hour programme dedicated to the greatest albums of all time, including features that explore listeners’ record collections and a weekly Classic Album Countdown. This show aims to celebrate the good times and great memories albums bring as Simon plays their Greatest Hits.
Greatest Hits Radio, which will officially launch across Swansea and South Wales on 1st September, offers listeners the biggest songs of the 70s, 80s and 90s, celebrating music from iconic artists like Blondie, Queen, George Michael, Madonna, Fleetwood Mac, David Bowie, Elton John and Whitney Houston. The station’s presenters will include a local weekday line-up as well as legendary broadcaster’s Mark Goodier, Paul Gambaccini, Simon Mayo, Janice Long and Pat Sharp on weekends.
Online applications for the ‘Getting You Back to Work’ campaign will open on the 1st September 2020. Employers looking to participate should email firstname.lastname@example.org more information on how to apply.
Graham Bryce, Group Managing Director – Hits Radio Network Brand,said, “As we look to the future, we’re very excited to add Simon Mayo to our weekend line-up. Simon’s track record speaks for itself and to have someone of his experience and status join the network adds a new dimension to the Greatest Hits presenter line-up.
“Alongside this, our stations continue to be committed to the local community and we’re proud to launch this initiative to provide a valuable boost at a time of great uncertainty and hardship. We know the pandemic has hit communities across the UK hard, and we want to use our privileged position to promote opportunities.”
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