M&Co has appointed administrators as it collapsed for a second time.
By Lucy Ashton
Favourite Christmas jumper and women’s fashion store M&Co has appointed administrators as it collapsed for a second time in just over two years. Financial advisory firm Teneo confirmed it had been brought in on Friday.
The Paisley-based company, which used to be known as Mackays, is one of Scotland’s best known clothing chains. It currently employs 1,910 staff with 170 shops across the UK.
They have a store in Sinclair Street in Helensburgh and formerly had a shop in High Street, Dumbarton, which is now closed.
It last collapsed in 2020 but assets were immediately bought back by the family that built it up.
In the last week the retailer has shut two stores in Dorchester in Dorset and Droitwich, Worcestershire.
Teneo said no immediate redundancies had been made.
M&Co will continue to trade while administrators explore a potential sale of the business, the firm added.
Gavin Park, one of the joint administrators, said M&Co had experienced a sharp rise in costs like many other retailers which had coincided with a “decline in consumer confidence”.
He added: “Despite a very loyal customer base, particularly in local markets, and a well-recognised brand, the current economic outlook has placed increasing pressure on the Company’s cash position.”
The clothing and homeware retailer’s plan was to launch three new women’s fashion brands over the two years to sit alongside its core M&Co brand women’s, men’s and children’s wear offering to realign its business strategy and “capitalise on the marketplace trend”.
They joined M&Co’s premium womenswear brand, Sonder Studio, and casual womenswear brand, Khost, both of which launched in September 2019 and count Next and SilkFred among their stockists.
The five womenswear and teenage girl brands were available to order on a franchise, concession, drop-ship and wholesale basis. They also have their own individual direct-to-consumer websites, and are sold on the M&Co website as third-party brands.
Until now, the business has stocked own men’s, women’s and children’s brand M&Co, and womenswear brand Viz-a-Viz, which operates online and as a concession in Penny Plain, Barkers and in some of M&Co’s 200 stores. These were both at lower price points to the newer brands.
“This forms a significant milestone in our journey from M&Co as a sole brand business to a multi-brand offer,” CEO Andy McGeoch tells Drapers, a trade magazine.
“As a business we have always had a strong capability of source, design and supply [M&Co sources mostly in Europe, and some areas in the Middle East].
Around two or three years ago we set up a team to start looking at producing new brands for our own stores to access different customers in the market.
“But over the last 12 to 18 months, we decided there were some stores in the estate where the [new brands] were relevant, and a lot of stores where they were not, so we started developing them and selling them via wholesale, and moved from a mono-single-brand-business to a multi-brand business.
“We are offering the brands via wholesale, franchise, drop-ship, and in-store concessions. We’ve got the full gambit of ways of working.
McGeoch said he wanted to expand the reach of the brands: “This is presenting a good opportunity for us to tap into both independents and multiples. We want to partner with as many people as possible. We want to partner with businesses both internationally and in the UK.”
This is presenting a good opportunity for us to tap into both independents and multiples. We want to partner with as many people as possible
Andy McGeoch, M&Co CEO
The brands are not set to be sold in M&Co stores, he explained: “These brands have been developed to sit outside the M&Co business, but if there is a store in a town that has the space and right demographic, we might consider it. But it wouldn’t be the plan, and only if right for that market. This is all about being a business within a business.”
However, he still sees a future for bricks-and-mortar stores: “We went through a store restructuring in the summer, so we are still seeing that piece through. We closed [around 47] stores [in 2020], so we are left with around 200 UK stores in the portfolio. We’re still negotiating rental deals on some stores.
“We’re mostly based in market towns, so we see that the M&Co store portfolio is exceptionally well placed. We are still very pro-traditional retail traditional and still feel strongly for the M&Co brand, but we feel this offering has revived and reinvigorated the original M&Co family piece.”