UK homeware retailer Wilko has warned that it is on the brink of collapse, putting some 12,000 jobs at risk.
The privately-owned company said it had filed a “notice of intention” to appoint administrators after failing to find enough emergency investment.
Wilko, which has 400 UK stores across the UK, is well-known for its affordable everyday items.
Chief executive Mark Jackson said it would continue to talk with interested parties about options for the business.
He said the company was left with “no choice but to take this action”, but hopes to find a solution as quickly as possible to “preserve the business”.
Wilko did not confirm in the announcement on Thursday whether or not any jobs would be affected.
Andy Prendergast, national secretary at the GMB union, said: "This is extremely concerning but we remain hopeful that a buyer can be found.
“Wilko’s staff deserve reassurance that their jobs are safe. We hope this is the number one priority going forward.”
Wilko added that it had received “significant interest” from investors and some offers, but none of them would have provided enough cash within the time needed.
Rising interest rates, higher energy costs and squeezed consumer spending have all been weighing on retailers.
Shops including furniture retailer Made.com and clothing group Joules collapsed into administration last year, although both were offered rescue deals by High Street giant Next.
But Wilko’s boss said on Thursday that the company, which has an annual turnover of about £1.2bn, had a “robust turnaround plan” in place.
The discount chain has been struggling for months and had been considering a company voluntary arrangement, under which some of its landlords would have received no rent for three years.
After Mr Jackson joined the retailer late last year, the retailer announced that it would cut 400 jobs in an attempt to cut costs.
At the time, the GMB union said the company was in a “fight for survival”.
Catherine Shuttleworth, founder of retail analysis firm Savvy Marketing, told the BBC that the announcement marked a sad day for a “stalwart of the UK High Street”.
“It should have been Wilko’s time to shine, with the Cost of Living crisis going on and shoppers looking for a bargain”.
But she added that customers had been going to rivals such as Home Bargains, B&M and the Range as they looked for discounted food, household goods and garden items.
Longer-term problems at Wilko have been exposed, she said, with a lack of investment over time and issues with stock in recent months.
The latest announcement by Wilko gives it breathing space of up to 10 working days to come up with a rescue deal.
The company, which was founded in 1930 in Leicester, is still owned by the Wilkinson family.
It has already borrowed £40m from Hilco, a specialist retail investor and the owner of Homebase, and has even been exploring the potential sale of a stake in business, according to reports by Sky News.
Ms Shuttleworth added: "I don’t think we’ll see Wilko disappear from the High Street, because it’s such a well-loved brand and shoppers hold it in high regard.
“But, it could look very different in the future.”
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Full text:
UK homeware retailer Wilko has warned that it is on the brink of collapse, putting some 12,000 jobs at risk.
The privately-owned company said it had filed a “notice of intention” to appoint administrators after failing to find enough emergency investment.
Wilko, which has 400 UK stores across the UK, is well-known for its affordable everyday items.
Chief executive Mark Jackson said it would continue to talk with interested parties about options for the business.
He said the company was left with “no choice but to take this action”, but hopes to find a solution as quickly as possible to “preserve the business”.
Wilko did not confirm in the announcement on Thursday whether or not any jobs would be affected.
Andy Prendergast, national secretary at the GMB union, said: "This is extremely concerning but we remain hopeful that a buyer can be found.
“Wilko’s staff deserve reassurance that their jobs are safe. We hope this is the number one priority going forward.”
Wilko added that it had received “significant interest” from investors and some offers, but none of them would have provided enough cash within the time needed.
Rising interest rates, higher energy costs and squeezed consumer spending have all been weighing on retailers.
Shops including furniture retailer Made.com and clothing group Joules collapsed into administration last year, although both were offered rescue deals by High Street giant Next.
But Wilko’s boss said on Thursday that the company, which has an annual turnover of about £1.2bn, had a “robust turnaround plan” in place.
The discount chain has been struggling for months and had been considering a company voluntary arrangement, under which some of its landlords would have received no rent for three years.
After Mr Jackson joined the retailer late last year, the retailer announced that it would cut 400 jobs in an attempt to cut costs.
At the time, the GMB union said the company was in a “fight for survival”.
Catherine Shuttleworth, founder of retail analysis firm Savvy Marketing, told the BBC that the announcement marked a sad day for a “stalwart of the UK High Street”.
“It should have been Wilko’s time to shine, with the Cost of Living crisis going on and shoppers looking for a bargain”.
But she added that customers had been going to rivals such as Home Bargains, B&M and the Range as they looked for discounted food, household goods and garden items.
Longer-term problems at Wilko have been exposed, she said, with a lack of investment over time and issues with stock in recent months.
The latest announcement by Wilko gives it breathing space of up to 10 working days to come up with a rescue deal.
The company, which was founded in 1930 in Leicester, is still owned by the Wilkinson family.
It has already borrowed £40m from Hilco, a specialist retail investor and the owner of Homebase, and has even been exploring the potential sale of a stake in business, according to reports by Sky News.
Ms Shuttleworth added: "I don’t think we’ll see Wilko disappear from the High Street, because it’s such a well-loved brand and shoppers hold it in high regard.
“But, it could look very different in the future.”