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Business shoppers to lose £12m in deposits, warn administrators

More than 30,000 shoppers are collectively owed almost £12m they will not get back, according to the latest report by administrators to the collapsed furniture seller.

Shoppers paid £13.7m in deposits on large items such as sofas, according to documents filed with Companies House late last week. However, less than £1.9m has been recouped by customers through card charge-backs, which is where credit card providers refund borrowers when purchases go wrong.

The document makes clear there will not be enough funds to repay the £11.9m owed to customers, who are on a list of unsecured creditors that are among the last to be paid when money is recovered from the sale of the company’s remaining assets. The list of unsecured creditors also includes suppliers and some employees.

Those assets include stock worth nearly £19m, which is expected to fetch less than £2m through auction.

Among’s biggest unsecured creditors are Facebook (owed £1.4m), Google (owed about £1.7m) and the operator of the group’s Antwerp warehouse (£1.8m).

However,’s main lender, Silicon Valley Bank, is likely to recover nearly all the £3.8m it is owed, after the retailer Next bought the brand and database for £3.4m. Most of its employees and HMRC, which is owed £3.57m, will also be paid in full.

Administrators from PricewaterhouseCoopers (PwC) were appointed to on 9 November, completing a reversal of fortunes for the London-based retailer, which was valued at almost £800m when it listed on the stock exchange in June 2021 and heralded as the future of furniture retail.

Its collapse was the latest example of the bursting of the online retail bubble, after investors who bet that the switch to buying online during the pandemic would be permanent had their hopes dashed.

More than 300 people were made redundant when the company went into administration and nearly all 500 employed at the time are expected to lose their jobs.

Retail experts are expecting more retailers to collapse as a result of the cost of living crisis, as consumers rein in their spending because of surging bills.

This could, however, provide opportunities for larger firms poised to snap up stricken competitors, according to Erin Brookes, the managing director and head of retail for Europe at Alvarez & Marsal, who said deals by Next to buy Joules and the brand out of administration point to further consolidation across the sector.

“There are retailers and brands which came out of the pandemic with much weaker balance sheets and have now been hit by lower consumer sentiment, alongside any supply disruption and cost inflation,” she said. “These still have something to offer, so some of the larger, more robust groups will definitely see opportunities around.”

Read more: shoppers to lose £12m in deposits, warn administrators

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