In a blow to the retail sector, Carpetright is teetering on the edge of collapse, with more than 1,800 jobs hanging in the balance.
The well-known flooring retailer has filed a notice of intention to appoint administrators in a bid to secure additional funding.
While advisory firm PricewaterhouseCoopers (PwC) has been lined up to manage the administration, their appointment is not yet finalised. In the meantime, Carpetright remains operational, with its 272 stores staying open and orders continuing to be fulfilled. However, the company will not be providing refunds, offering alternative products or earlier deliveries instead.
Kevin Barrett, CEO of Nestware Holdings—the parent company of Carpetright—revealed that the firm’s restructuring efforts were derailed by a significant slump in trade following a cyber-attack in April. “This has resulted in the company seeking a period of protection whilst sale negotiations proceed,” Barett stated. He emphasised that the primary focus is to minimise the impact on customers and employees.
Declining customer demand
Carpetright, one of the UK’s largest flooring retailers, has been struggling with declining customer demand, particularly for big-ticket items, as consumers tighten their belts and prioritise essential purchases. John Cullen, a partner and insolvency expert at business advisory firm Menzies, commented on the challenging retail environment, noting that the cyber-attack was likely the “straw that broke the camel’s back.”
The company now has a 10-day window to find a potential buyer. This is not the first time Carpetright has faced financial difficulties. Six years ago, the retailer underwent insolvency proceedings to reduce costs, resulting in the closure of 81 stores after reporting a full-year loss exceeding £70 million.
The news of Carpetright’s potential collapse emerged just a day after reports surfaced that the company had put itself up for sale. Founded in 1988, Carpetright opened its first store in Canning Town, East London, and enjoyed years of success, even listing on the London Stock Exchange in 1993 before being delisted in 2020. The retailer’s product range now includes not only flooring but also mattresses, curtains, blinds, garden furniture, and artificial grass.
As the company grapples with its current crisis, the future of Carpetright and its 1,800 employees remains uncertain.
Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.
