Carpetright takes step towards collapse with 1,850 UK jobs at risk

The retailer's parent firm says it remains in discussions with interested parties as Carpetright battles to secure new investment and avoid administration.

James Sillars

Business reporter @SkyNewsBiz

Friday 12 July 2024 18:34, UK

A view of Carpetright in Leeds, as the company has warned it is set to swing to a full-year loss and said it has started talks with its lenders as the woes in the retail sector show no sign of letting up
Image: Carpetright's troubles have included tough competition for business during the cost of living crisis. Pic: PA
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One of the UK's biggest floorings retailers is just one step away from a collapse that would place 1,852 jobs at risk.

Cash-strapped Carpetright confirmed it had filed a notice of intention to appoint administrators.

Such a move typically gives a company up to 10 days to potentially avoid an insolvency process.

The loss-making firm said in a statement that it was still working towards a reprieve and would continue to trade as normal from its store estate and online.

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Parent firm Nestware Holdings stated it was still trying to "finalise additional investment" to secure Carpetright's long-term future but suggested that some job losses were inevitable, whatever the outcome.

Nestware chief executive Kevin Barrett said: "We remain focused on securing external investment to ensure as few customers and colleagues are impacted as possible.

"They are our main priority and we are taking all appropriate action to make sure they are informed and supported through this process.

"We have begun promising conversations with interested parties that are moving in the right direction, encouraging us that Carpetright has a viable future."

Lord Harris of Peckham
Image: Lord Harris of Peckham founded Carpetright in 1988

Sky News revealed in May that Carperight, which has 272 UK stores, was cutting more than 25% of its head office staff in Essex under renewed efforts to save cash.

It has grappled with a protracted downturn in trading.

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Part of that can be explained by years of weak consumer confidence amid the cost of living crisis.

That has knocked household budgets for so-called big-ticket items since the COVID pandemic.

The chain has also faced strong competition from rivals while a cyber attack in April was blamed for a knock-on effect on trade too.

Carpetright, which was founded by Lord Harris of Peckham in the late 1980s, closed dozens of stores in 2018 under plans to bring losses under control.