Paperchase to slash several UK stores in bid to reduce costs
Popular high street stationer Paperchase has revealed it is closing five of its 145 stores.
It has been also been reported that 23 stores are currently at risk, as the retailer aims to slash its rent in half.
Paperchase has seen its customer numbers drop, but its rent and business rates have increased. Higher costs have also been due to the pound’s loss of value.
Pre-tax profits have fallen from around £600k (in 2017), to a major loss of £6.3m in 2018.
Will Wright, restructuring partner at KPMG and proposed supervisor of the CVA, stated the deal gives Paperchase an “ability to rationalise its store portfolio by exiting stores that are unprofitable, [and] secure rent reductions where stores are over-rented”.
The retailer’s turnover has supposedly increased by six per cent, however, due to growth online and overseas.
Creditors are to vote on such proposals for Paperchase on March 22, 2019. The retailer will need to secure at least 75 per cent creditor approval so that the CVA’s deal can be put in place.
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