4,000 Jobs in the Balance as Barratts go into Administration
Shoe chain Barratts, has this Thursday (08/12/11) gone into administration for the second time in two years. There are potentially as many as 4,000 jobs at stake with Christmas just around the corner.
With some rather well known share holders, such as American bank Goldman Sachs, the shoe store chain could be closing as many as 200 shops up and down the country in an attempt to ease pressure from debtors. The company have a debt of £240 million and in a last ditch attempt to try and turn around the company’s fortune they could maybe look at factoring some of their invoices out. This is where they sell any monies that are owed to a business at a reduced rate meaning they get the cash fast, and don’t have to do the debt collecting.
There are some other alternatives for the company to try and save themselves. They could look into pre pack administration. This is another way of ensuring the business will still be running in the short term, while they try and sort out the long term future of the company. Pre pack administration is when a company sell the business on to a third party or to members of the board. When the sale has gone through the company instantly become protected by the courts, which gives the opportunity ensure the stability of the company.
When asked about the situation, Barratts declined to comment but gave a short statement: “We continue to progress our restructuring discussions and plans, with no decisions taken at this point.”
There’s no doubt that the current economic situation that almost the whole world finds itself in has played its part in dragging Barratts this far down for the second time in two years. There are many different companies around the world who probably find themselves in a similar situation to what Barratts find themselves in currently and many of them still live to tell the tale!
If you want to find out more on anything financial or business related then you should pay a visit to realbusinessrecovery.co.uk and see how they can help you!