Administrators called in at Office Outlet - putting jobs at risk in Ipswich
PUBLISHED: 16:56 19 March 2019 | UPDATED: 08:54 20 March 2019
Stationery company Office Outlet, which has branches in Ipswich, Colchester, and Chelmsford, has gone into administration - putting 1,200 jobs at risk across the country.
The company, which took over Staples’ UK store-based operation in 2016, has 90 stores across the country and is continuing to trade as a buyer is sought for the business.
Staples UK is now an online-only business that has no connection with Office Outlet.
Partners at Deloitte were appointed joint administrators on Monday.
Joint administrator Richard Haws said: “In addition to a general downturn in trading as a result of the ongoing decline in the stationery market and UK retail in general, the company has recently experienced a reduction in credit from key suppliers, given the economic outlook which has severely impacted the financial position of the company.
“We are hopeful a buyer can still be found for the business in the coming weeks and we will continue to trade the business with that aim in mind.”
The chain launched a plan last August to shut a handful of stores under a form of insolvency called a Company Voluntary Arrangement (CVA).
The deal also included three years of free rent on 20 sites.
But the move failed to save the chain, which is understood to have had trouble scraping together rent for its estate of more than 90 stores ahead of the due date on Friday.
US-based stationery giant Staples agreed to sell its UK shops to Hilco Capital, the former owner of HMV, in late 2016. The chain was then renamed Office Outlet.
Office Outlet chief executive Chris Yates said: “Over the last two years the business has been transformed from the heavily loss-making old Staples business to a near break-even modern multichannel retailer.
“However, additional growth capital was required to continue delivery of the next stage of the management buyout business plan.
“Despite being highly impressed by the Office Outlet story potential investors have held back due to retail sector sentiment and the general level of uncertainty.”
It represents another disappointing end to a Hilco investment, after the firm placed HMV into administration late last year before it was sold to Sunrise Records.