Londim
11-12-2008, 16:04
Bargain hunters are flocking to branches of Woolworths as a store closure sale starts at all its 815 outlets across the country.
In what looks like the beginning of the end for the retailer, its administrator Deloitte has said that some shops could close for good by the end of the year.
Deloitte is also due to consult with Woolworths' 30,000 staff over the possibility of redundancies.
Talks over the sale of the leaseholds of individual stores are continuing.
It is thought that Sainsbury's, Asda, Tesco, the Co-op and discount chain Poundland are still interested in picking up some of the retailer's prime sites.
Explaining the store closure sale, Deloitte said: "Christmas is clearly the busiest time of the year for retailers and it is prudent to do all we can to sell existing stock."
Several shoppers have contacted the BBC to say that the discounts on offer were no different to those introduced last week, and said they were angry after queuing to get into stores to snap up bargains.
However a spokesperson for the administrators said that larger price reductions had been applied to some items, while more products were now included in the sale.
'Failing brand'
Nick Hood from the business rescue experts Begbies Traynor said it was the beginning of the end for Woolworths.
"This has been a failing brand for a long time," he said.
"It just never kept pace with the change in the High Street, its core DVD and CD business has been taken away by the online trade."
"It's been very, very difficult - it just hasn't been as fleet footed as many of its rivals."
Deloitte had held talks to sell the business as a going concern to potential buyers including former Woolworths chief executive Sir Geoff Mulcahy and Dragons' Den star Theo Paphitis, but no deals could be reached.
Shopworkers' union Usdaw said the latest developments at Woolworths were "absolutely devastating" for its members.
"We have now gone from the business going into administration and staff believing they had got jobs safe up to Christmas to now being in a closing-down sale, which effectively means they are under threat of redundancy," national officer John Gorle told the BBC.
He said that Woolworth's still had a future, but conceded it was a "desperate situation".
"Many of the staff are long-serving employees. To have worked there for 10 to 15 years is not uncommon and for those workers Woolworths is not just a job but a way of life."
The Pension Protection Fund (PPF) has been formally notified that Woolworths is insolvent and is in contact with the firm's pension fund trustees.
The PPF was set up in 2005 to ensure that members of final salary schemes get their pension if their employer goes under.
Debt mountain
Woolworths went into administration on 26 November with £385m of debt.
The firm's music, DVD and games distribution subsidiary, Entertainment UK, is also in administration.
Last week, rival retailer Zavvi, which is a customer of Entertainment UK, said the situation was causing shortages of certain products in its stores.
Media publishing business 2Entertain, in which Woolworths owns a 40% stake is not in administration. The other 60% of this business is owned by BBC Worldwide, the BBC's commercial division.
Woolworths had been due to celebrate its 100th anniversary next year. Its first UK store opened in Liverpool in 1909.
http://news.bbc.co.uk/1/hi/business/7776634.stm
So one of the biggest and most respected high street chains in the UK can survive no more. I for one thank Woolworths for all the bargains I got from there over the years.
So in light of the fact no business is safe at the moment, which business or brand would you not like to see fail?
In what looks like the beginning of the end for the retailer, its administrator Deloitte has said that some shops could close for good by the end of the year.
Deloitte is also due to consult with Woolworths' 30,000 staff over the possibility of redundancies.
Talks over the sale of the leaseholds of individual stores are continuing.
It is thought that Sainsbury's, Asda, Tesco, the Co-op and discount chain Poundland are still interested in picking up some of the retailer's prime sites.
Explaining the store closure sale, Deloitte said: "Christmas is clearly the busiest time of the year for retailers and it is prudent to do all we can to sell existing stock."
Several shoppers have contacted the BBC to say that the discounts on offer were no different to those introduced last week, and said they were angry after queuing to get into stores to snap up bargains.
However a spokesperson for the administrators said that larger price reductions had been applied to some items, while more products were now included in the sale.
'Failing brand'
Nick Hood from the business rescue experts Begbies Traynor said it was the beginning of the end for Woolworths.
"This has been a failing brand for a long time," he said.
"It just never kept pace with the change in the High Street, its core DVD and CD business has been taken away by the online trade."
"It's been very, very difficult - it just hasn't been as fleet footed as many of its rivals."
Deloitte had held talks to sell the business as a going concern to potential buyers including former Woolworths chief executive Sir Geoff Mulcahy and Dragons' Den star Theo Paphitis, but no deals could be reached.
Shopworkers' union Usdaw said the latest developments at Woolworths were "absolutely devastating" for its members.
"We have now gone from the business going into administration and staff believing they had got jobs safe up to Christmas to now being in a closing-down sale, which effectively means they are under threat of redundancy," national officer John Gorle told the BBC.
He said that Woolworth's still had a future, but conceded it was a "desperate situation".
"Many of the staff are long-serving employees. To have worked there for 10 to 15 years is not uncommon and for those workers Woolworths is not just a job but a way of life."
The Pension Protection Fund (PPF) has been formally notified that Woolworths is insolvent and is in contact with the firm's pension fund trustees.
The PPF was set up in 2005 to ensure that members of final salary schemes get their pension if their employer goes under.
Debt mountain
Woolworths went into administration on 26 November with £385m of debt.
The firm's music, DVD and games distribution subsidiary, Entertainment UK, is also in administration.
Last week, rival retailer Zavvi, which is a customer of Entertainment UK, said the situation was causing shortages of certain products in its stores.
Media publishing business 2Entertain, in which Woolworths owns a 40% stake is not in administration. The other 60% of this business is owned by BBC Worldwide, the BBC's commercial division.
Woolworths had been due to celebrate its 100th anniversary next year. Its first UK store opened in Liverpool in 1909.
http://news.bbc.co.uk/1/hi/business/7776634.stm
So one of the biggest and most respected high street chains in the UK can survive no more. I for one thank Woolworths for all the bargains I got from there over the years.
So in light of the fact no business is safe at the moment, which business or brand would you not like to see fail?