DEPARTMENT store Beales has collapsed into administration after failing to find a last-minute buyer to rescue the business.
About 1050 jobs at the 23 stores are now at risk – including the chain’s Perth branch, its only store in Scotland. The company’s website has been taken down, but the stores will continue trading while administrators look for a buyer. All staff will be kept on in the meantime.
The retailer is the latest high street name to suffer from soaring business rates and the public leaving shopping centres behind in record numbers.
Last month, Beales hired advisers at KPMG to lead a strategic review in order to find a profitable future for the business.
READ MORE: High street in ‘crisis’ after rise in closures, report warns
Will Wright, joint administrator at KPMG, said: “With the impact of high rents and rates exacerbated by disappointing trading over the Christmas period, and extensive discussions around additional investment proving unsuccessful, there were no other available options but to place the company into administration.” The company was previously in talks with landlords over rent reductions, through a company voluntary arrangement, and reports suggested two potential buyers had been lined up.
Before the administration, chief executive Tony Brown told newspaper The Daily Echo that the retailer has struggled with difficult trading conditions and criticised the “lunacy” of high business rates.
He said: “I can’t predict which stores will stay and which stores won’t because it all depends on landlords and local government.”
He also accused councils of failing to help struggling retailers, saying that local authorities “really don’t care” about high street stores. Speaking to the BBC last week, he said: “We’ve only managed to get one council to help us out on a temporary basis.”
He added: “At the moment, in my view, councils really don’t care, because they get their business rates whether we’re there or not, because the landlord pays if the store closes.”
A Government spokesperson said: “We understand this must be a worrying time for employees and their families. The company has now appointed administrators who are seeking a solution.While the Government cannot intervene directly, we are in direct contact with the company’s CEO and officials are monitoring the situation closely.”
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