ELECTRONICS RETAIL CHAIN Maplin has blamed Brexit for its decision to enter into administration as it battles to stay afloat.
The UK-based electronics retailer, which has traded for more than four decades, collapsed into insolvency today after a failed attempt to secure a buyer for the business.
Maplin operates more than 200 stores in the UK and employs over 2,300 people. It has two stores in Dublin and one each in Dundalk, Cork, Galway and Limerick.
A spokeswoman for administrators PwC confirmed to Fora that Maplin’s Irish stores could potentially be shuttered but each branch will continue to trade as normal for the time being.
Through a statement, Maplin’s chief executive Graham Harris – who took up the role only a month ago – said a weakened sterling in the aftermath of the Brexit vote and poor consumer confidence contributed to its failure.
“I can confirm this morning that it has not been possible to secure a solvent sale of the business and as a result we now have no alternative but to enter into an administration process,” he said.
“The business has worked hard over recent months to mitigate a combination of impacts from sterling devaluation post Brexit, a weak consumer environment and the withdrawal of credit insurance.
“This necessitated an intensive search for new capital that in current market conditions has proved impossible to raise. These macro factors have been the principal challenge not the Maplin brand or its market differentiation.”
UK consumer spending has swung into reverse since the Brexit vote, with 2017 the worst year for the retail sector since 2012.
‘Hit hard’
PwC joint administrator Zelf Hussain said Maplin has been “hit hard by a slowdown in consumer spending and more expensive imports as the pound has weakened”.
He added: “Staff have been paid their February wages and will continue to be paid for future work while the company is in administration.”
Maplin’s collapse comes the same day that another major UK retailer announced that it has called in the administrator.
The British wing of Toys R Us – which filed for bankruptcy in the US in September – also collapsed into insolvency after failing to find a buyer.
Some 3,000 jobs are at risk at the toys retailer, which operates two stores in Belfast and one in Derry.
Written by Conor McMahon and posted on Fora.ie
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