Time for a new series here at Money Watch: Recession Watch. In this series, we’ll look at the effects of the recession on the UK (let’s not argue about whether we’re officially in recession yet), and this morning there’s some mixed news for three high-street stores.
Music and DVD retailer Zavvi has been put into administration, according to Ernst & Young. One of its main suppliers had been Entertainment UK, the distribution arm of Woolworths, which we all know will cease trading by 5th January. Zavvi first entered the high street a couple of years ago, after taking over Virgin Megastore’s shops. It currently employs 2,500 3,500 people and has 125 stores, so despite being small compared with Woolworths, it’s still a significant number of possible job losses. Since Woolworths’ problems, Zavvi have themselves experienced difficulties in fulfilling customers’ orders. Their website recognises this fact, but they’ve yet to update with any news on entering administration themselves.
Zavvi is likely to remain open until a buyer for part or all of the business can be found.
Slightly better news is that 140-year old tea & coffee shop Whittards has been bought by a private equity firm after also going into administration, which will mean that it can continue trading for the moment, keeping 950 people in their jobs. Whether it proves to be a long term survivor remains to be seen.
Finally, another 900 jobs have been saved as clothes retailer The Officers Club has been sold – although 32 of its stores will close, so not all jobs will be saved.