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Made.com: what are your rights when a company collapses?

A sign in the window of the Made.com store in Charing cross Road, London as up to 700 jobs are at risk after the online furniture firm revealed it is set to appoint administrators following a failure to secure a rescue deal. The company said its operating arm, Made.com Design Ltd (MDL), has filed a notice to appoint administrators, with PricewaterhouseCoopers lined up, while shares in the London-listed group have been suspended. Picture date: Tuesday November 1, 2022. (Photo by Yui Mok/PA Images via Getty Images)
A sign in the window of the Made.com store in Charing cross Road, London. Photo: Yui Mok/PA /Getty

If you’re on the edge of your rather threadbare seat waiting for a Made.com order, the last couple of weeks have been incredibly stressful, as you wait to hear whether your new sofa is ever going to materialise. The news that Next plans to snap up the name and its website hasn’t been accompanied by an update for customers, so it’s worth knowing where you stand.

The good news is that the company has confirmed that orders will be fulfilled, and while at the moment we can’t read this as an iron-clad guarantee, it’s a really promising sign. Things aren’t so simple for all customers though, because if you’ve decided you don’t want your new sofa, unfortunately you can’t cancel and get a refund from the company, because it’s not processing them at the moment. If it arrives it and you don’t like it, it’s broken, or parts are missing, then things are thornier again.

The Made.com store in Charing cross Road, London as up to 700 jobs are at risk after the online furniture firm revealed it is set to appoint administrators following a failure to secure a rescue deal. The company said its operating arm, Made.com Design Ltd (MDL), has filed a notice to appoint administrators, with PricewaterhouseCoopers lined up, while shares in the London-listed group have been suspended. Picture date: Tuesday November 1, 2022. (Photo by Yui Mok/PA Images via Getty Images)
The Made.com store in Charing cross Road, London as up to 700 jobs are at risk. Photo: Yui Mok/PA/Getty Images

Read more: Made.com collapse puts hundreds of jobs at risk

Technically you have some consumer rights here. You have a right to return anything you bought online within 14 days for a refund under distance-selling rules. You also have the right to a refund on items that are delivered broken or faulty. It’s just that when a company goes into administration, it’s incredibly difficult to claim.

Made.com is not taking returns at the moment and not issuing any refunds. It means buyers are being forced to wait for more details. If you had already returned a faulty item and not received a refund when it went into administration, you’re in the worst of all worlds, because you don’t have the sofa or the money. There’s the chance you will simply be added to the bottom of a long list of people who are owed money – with little chance of getting anything back – let alone a full refund.

It means it’s worth exploring any other options. If you bought with a credit card, under section 75 of the Consumer Credit Act, as long as it cost between £100 and £30,000, the card firm is equally liable for the transaction, so you can claim the money back from the card company. If you bought with a debit card, meanwhile, you can ask your bank to try a chargeback. This isn’t a legal right, but the bank can try to get the money back on your behalf.

What if you’re worried about another company?

Given how many stores are already struggling, and how many more will be hit by the looming recession, Made is not going to be the final casualty, so it’s worth being aware of the best approach more generally. In this environment, it may be worth buying larger item with a credit card to secure your section 75 rights – although it should go without saying that this can’t be an opportunity to run up expensive debts.

If you get wind of a retailer being in trouble and you’ve placed an order already, it may be best to cancel and claim the money back before it enters administration and is still operating its usual cancellation process. If it’s too late, and they have gone into administration and are not going to deliver, then you can try to get your money back through the credit or debit card company. If all this fails, then there may still be hope if someone buys the company, because they may decide to honour orders or refunds. However, there are no guarantees on this front.

It’s worth adding that if you have a gift card or voucher for a company, and you’re worried about its future, it’s worth spending it sooner rather than later. If it goes into administration then it may continue trading for a while, but it may refuse to take vouchers. Likewise if someone buys it out of administration, previously some companies have continued to accept vouchers, but they’re not compelled to, so your valuable vouchers could be transformed overnight into worthless pieces of paper.

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