Matchesfashion, the luxury online clothes retailer is to be put into administration by Mike Ashley’s Frasers Group.
Sky News reports that a number of brands terminated their relationship with the site and the company faced heavy losses, thus the filing of a notice of intention to appoint administrators.
Other sources have reported that some of the brands have not been paid for months and that some suppliers were asked for discounts.
Along with this, there has been a sharp slowdown noticed across the global luxury goods sector, as the UKs current economic state has left many consumers with less disposable income to put towards such goods.
Frasers Group took on the clothing platform not even 3 months ago. It is not clear if control would remain with Frasers in the event of a pre-pack insolvency.
Nick Beighton has led the company since 2022. With his leadership the platform saw a steep increase in performance, said to be due to his renewed focus on operational efficiency and effective marketing. It is also unclear if Mr Beighton would continue in his role post-administration.
Matchesfashion features more than 500 established and ‘new generation’ designers, delivering to over 170 countries.
Matchesfashion is the second high-profile retailer to be put into administration shortly after being taken over in recent weeks. Earlier this year Aurelius placed the UK chain of The Body Shop into administration. Why does this happen? Could it be hubris or do these buyers see more value in the brand name rather than the actual business in the long term. The brand name is usually retained and sold back to the original owners if the business as a whole is not sold to a third party.
Will the clothing platform be brought back to life?