High street stationery chain, Paperchase, has revealed it is on the brink of administration after sales were impacted when branches were forced to close at the end of last year due to the coronavirus pandemic.
The business has confirmed that it has filed a notice to appoint administrators from PricewaterhouseCoopers to run the process.
The retailer, which has 127 stores and around 1,500 employees, went through a company voluntary arrangement (CVA) in March 2019 in a bid to cut costs and make the business more viable. However, while online sales have continued to perform strongly this was not enough to mitigate the overall impact of enforced closures with greetings and stationery classed as non-essential retail.
Trading in the festive period of November and December usually accounts for 40% of Paperchase’s annual sales. However, sales during this time were severely impacted due to lockdown regulations and various tier restrictions across the country.
“The cumulative effects of lockdown 1, lockdown 2 - at the start of the Christmas shopping period - and now the current restrictions have put unbearable strain on retail businesses across the country. Paperchase is not immune despite our strong online trading” a Paperchase spokesperson said.
“Out of lockdown we’ve traded well, but as the country faces further restrictions for some months to come, we have to find a sustainable future for Paperchase. We are working hard to find a solution and this NOI (Notice of Intent to appoint administrators) is a necessary part of this work.”
“This is not the situation we wanted to be in. Our team has been fantastic throughout this year and we cannot thank them enough for their support.”