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.