As retailers across a wide range of merchandise categories have been reporting, trading through and out of the pandemic has proved to be problematic.
Virgin Wines is the latest to reveal that whilst its trading revenues had grown, margin had taken a nose-dive. In its trading update for the six months to December 31st the wine business reported a 55 per cent increase in its sales to £40.5 million but said that profits and revenues are expected to be lower than expected. A shortage of staff had forced Virgin Wines to bring forward its cut off date for Christmas order deliveries which had cost it lucrative sales.
The business said: “Like many businesses, we experienced severe operational challenges in the period due to well-publicised, external, macroeconomic factors including labour market shortages caused by the emergence of the Omicron Covid-19 variant, staff absences due to illness/self-isolation, freight disruption and inflationary pressures.”
In other related news, Luxury Home Furniture Ltd which traded as Shabby, has ceased to trade and called in administrators. The business has supplied home furnishings and accessories and had achieved £2m sales in its last financial year.
Steven Wiseglass, director, Inquesta Corporate Recovery & Insolvency has been appointed as administrator and is seeking to sell the Shabby brand, website, stock & goodwill. He said that Shabby had expanded during the first lockdown but was then severely impacted by shipping delays, increased operating and import costs, the lossd of its largest UK supplier, adverse customer reaction to price increases, creditor pressure and falling sales.
“The directors tried to keep the business afloat but unfortunately the combination of factors had a devastating impact on its viability and they were ultimately unable to save it. The process to seek a buyer is underway.”
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