Made.com has gone into administration, and has sold its brand name, website and intellectual property to fashion and furniture retailer Next.
With a potential loss of up to 600 jobs, administrators at PricewaterhouseCoopers (PWC) are now tasked with selling the company's other assets and paying off its debts to creditors.
With Made now officially entering administration, thousands of customers face uncertainty over outstanding orders placed with the retailer.
Susanne Given, chair of Made, said: 'Having run an extensive process to secure the future of the business, we are deeply disappointed that we have reached this point and how it will affect all our stakeholders, including employees, customers, suppliers and shareholders.
'We appreciate and deeply regret the frustration that [Made.com] going into administration will have caused for everyone.'
Made was an online store with two UK showrooms showcasing its designs and latest collaborations – it's flagship showroom in London on Charing Cross Road, and inside the Redbrick department store in West Yorkshire.
Made.com suspends orders
Made – known for its velvet sofas, contemporary lighting, on-trend accessories and designer collaborations – had been in discussion with a number of interested parties at the beginning of October, but attempts to secure a buyer failed. On Wednesday (26th October), the online furniture retailer suspended its website and stopped taking new customer orders.
Made.com announced its intention to appoint administrators last week, with a message on the website confirming: 'Sorry Made is not currently taking any new orders. Made Design Ltd has filed a notice of intention to appoint administrators.'
The previous message just days before had said: 'Sorry, Made is not currently taking any new orders. We appreciate your patience and we hope to be able to restart accepting orders again soon.'
This news comes after Made.com put itself up for sale last month following a 32 per cent fall in shares. It warned that it needed to secure £70 million in funding over the next 18 months to stay afloat.
Co-founder Ning Li speaks out
Made.com's co-founder, Ning Li, has criticised the recent direction of the business and said it was 'heartbreaking' to see the company he started 'on a shoestring in Notting Hill' move closer to administration.
Typology founder Ning Li founded Made.com in 2010 with Brent Hoberman and Chloe Macintosh, but in a new post on LinkedIn he criticised the recent direction of the business.
Ning Li wrote on LinkedIn (27th October):
'Yesterday’s news was as heartbreaking as it gets for a founder. MADE.COM just announced it failed to secure rescue financing and stopped taking orders. The brand was my baby. It pains me to see that suddenly the lifeline of many (800!) employees and hundreds of suppliers – some of them have been with the business over a decade, is in jeopardy. I feel both powerless, having stepped down as CEO in 2017, but also immensely frustrated as lawyers and the board has formally forbid me to even talk to any of them.
'The mantra was simplicity – because it meant value for our customers and cost efficiencies for the business. From where I am sitting today I think the brand has lost sight of that focus in the recent years, and as a result, lost its strength.
'But should there be any future for MADE.COM – I do hope and pray that there is, I think that simplicity will be the only way forward.'
The rise and fall
During the Covid pandemic, Made.com's sales surged (£315 million in 2020, up 30 per cent year-on-year) as people were confined to their homes and bought more furniture as they undertook decorating projects.
Made.com listed on the London Stock Exchange in June last year with a value of £775 million, but has since suffered a collapse in its share price, leaving the company with a £2.5 million price tag as of Thursday, The Telegraph reports.
Russ Mould, investment director at AJ Bell, told BBC News that the firm became 'unstuck' due to supply chain problems, with 'customers waiting months for their sofas to be delivered, leading to cancellations and frustration'.
With a recent decline in demand for furniture, and the cost of living crisis, Made.com has also had to discount more of its products, squeezing margins further, all of which have contributed to a severe slump in its share price.
The business employs 700 people, but in September, Made announced that it was in the process of making more than a third of staff redundant.
What this means for customers
News of Made.com's collapse is concerning for customers who have placed orders that have not yet been delivered. New orders have been suspended for some time now and it meant customers were also unable to use any outstanding gift cards or vouchers on the website.
More consumer advice...
If you spent £100 or more and paid by credit card, you can make a claim with your credit provider under Section 75 of the Consumer Credit Act (useful if a retailer has ceased trading).
If you paid by debit or credit card you can make a chargeback claim – for goods that haven't been delivered or are faulty/damaged or not as described – with your bank (useful if goods are under £100 and Section 75 doesn't apply).
If you have a faulty product from Made.com, check if the manufacturer's or third-party warranty is still valid.
Make a claim in writing to the administrator (useful if administrators decide to stop honouring gift cards and vouchers).
For more guidance, visit Citizens Advice.
A statement from Made.com
In a statement, Made.com said on Wednesday (26th October): 'The board is considering the position and a further announcement will be made in due course. If further funding cannot be raised, or a firm offer for the company is not received before the company's cash reserves are fully depleted, the board will take the appropriate steps to preserve value for creditors. There can be no certainty that the terms of any offer or investment received will be suitable.'
The announcement comes after the online mattress seller, Eve Sleep, also collapsed into administration this month but was rescued by Bensons For Beds.
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