Rapid Discount Outlet Goes Into Administration
11-May-2017Rapid Discount Outlet, a major Liverpool-based DIY store, has gone into administration.
The news was announced by the Liverpool Echo, who received confirmation from representatives via phone on 8 May.
Rapid Discount Outlet was founded in 2013. The store employs 48 staff and stocks DIY products, gardening supplies, furniture, electrical appliances, lighting, and kitchen/bathroom suites.
The company is based on a similar model to that of Rapid Hardware, which was owned by the same group and went into administration in 2013 after 42 years of trading.
All orders currently in place with Rapid are set to be honoured although if you have had bought goods on credit card then you will have added protection. Customers will also still be able to make purchases in-store, but only using cash payments.
Why have they gone into administration?
Local residents have suggested that the company has been forced to enter administration due to poor parking options limiting the ability of customers to purchase big-ticket items.
Rapid Hardware moved from Renshaw Street to Bassnett Street in 2010. Customer feedback suggests the lack of parking made it difficult for them to transport large items, such as rugs, wallpaper and furniture.
After Rapid Hardware went into administration, Rapid Discount Outlet (which occupies the same premises) faced the same problem with parking, resulting in an identical outcome.
Rapid Discount Outlet were due to submit company accounts for 2016/17 on 31 March. Due to its size, the company is only required to submit abbreviated accounts.
However, no such submission has been received by the regulator. Therefore, the official explanation as to why the company has entered administration is yet to be made clear.
The most recent accounts filed by the company showed shareholder funds of £322,000 in the year ending June 2015. This is down from £356,000 in 2014, indicating an ongoing downward trend.
Duff & Phelps are acting as administrators for Rapid Discount Outlet. Company representatives have announced that the store will continue to trade while its future is being decided. A statement from the administrators read: “The administrators are reviewing the financial position of the business, with a view to continuing to trade to enable the business and assets to be sold."
Rapid Discount Outlet therefore has the chance to emerge in a new form following the administration period. However, transitional arrangements would need to include restructuring, an injection of funds and possibly a buy-out.
Retailers are feeling a bit of pressure at the moment due to business rates, and slowing consumer spending on the back of rising inflation.
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