Jessops falls into administration, store closures to begin this weekend

Written on:January 10, 2013
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Jessops falls into administration

Specialist photographic retailer Jessops collapses, unable to withstand technological changes

Closure of Jessops stores across the UK is likely to begin by the end of this week as the troubled photographic retailer fell into administration yesterday, jeopardising 2,000 jobs at the 192 stores of the chain. PricewaterhouseCoopers (PwC) has been appointed as the collapsed chain’s administrator. Jessops marks the first high profile retail collapse of 2013 and joins the list of failed high street retailers including Comet, JJB Sports, Game, Peacocks and Blacks Leisure, who went into liquidation last year.

Jessops’ administrator PricewaterhouseCoopers said that the attempt to find a buyer for the collapsed chain has begun, but has admitted that closure of some stores is inevitable. Currently, Jessops administrator has said that shoppers will not be able to use Jessops vouchers, although that decision may be reviewed in coming weeks. Returned goods will also not be accepted.

Jessops is estimated to have debts of £60m, including £30m of trade debt and £30m owed to HSBC, which the bank is likely to lose now. Over the past few years, Jessops has been hit by the changes in the way consumers buy cameras, the growing use of smartphones, and other retailers such as Tesco diversifying into digital cameras market. This coupled with tight-stringed behaviour of British consumer due to the difficult economic conditions spelled doom for Jessops. The retailer’s own multi-million pound investment in a new modern store format also failed to drive any increase in sales in 2012 on the £236m reported the previous year.

Jessops chain was established in 1935 and currently has 192 stores. Jessops had been chased by financial troubles since 2007, which led to a re-financing of the chain by its banker HSBC in September 2009. Jessops’ trade was then transferred to a new holding company Snap Equity Limited, placing the photographic chain into liquidation and the group’s final salary pension scheme transferred to Pension Protection Fund (PPF). Snap Equity formed as a private company which was 47% owned by HSBC, 33% by pension trustees, and 20% by an employee trust.

     

4 Comments add one

  1. Harold says:

    Whether this collapse was due to unduly high rates, excessive rent, aggressive parking policy or not, councils and landlords now have to live with yet another retailer biting the dust.

  2. Martin says:

    Jessops problem was being floated and getting large too quickly. Before that exercise they were a family-owned company with premises in Liecester, who could perhaps have survived.

  3. Ardy says:

    Who’s next? HMV? House of Fraser is doing pretty well as of now, and DSG has got lesser competition now.

  4. Duncan says:

    With so many illustrations, it should be amply clear by now that goods are available through many mediums and technological advancement should be the goal of the hour for any business to survive.

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