Cox & Cox appointed Ian Defty and Bai Cham of Begbies Traynor as joint administrators on 27th February 2023.
The online homewares business had flown high in recent years, posting significant growth in its revenues – reaching £38m at its peak, which was largely fuelled by the effects of the pandemic. During this most unusual period which saw consumers pretty much confined to their homes and unable to take their usual overseas holidays, expenditure on homewares rocketed and it was the online/DTC sector that benefited most as it was able to meet and, importantly, fulfil demand.
However, once non-essential stores had re-opened and travel restrictions eased, consumers were keen to make up for lost time, visit shops and book overseas holidays. Add to this reduction in demand then falling further, due to the economic uncertainties and inflation caused for the most part by Russia’s ferocious war against Ukraine, and consumer spending on all but essentials fell to an all time low. With sales in dramatic decline, businesses like Cox & Cox were also heavily impacted not only by soaring freight costs but by the widely reported disruptions to their stock deliveries. Many businesses suffered badly as a result, with seasonal stock, including Christmas lines, landing long after their primary sale periods, and having to pay additional costs to store this unsold stock. Then, add in the series of strikes at Royal Mail which had the knock-on effect of disrupting home deliveries across all carrier services right across the most recent past peak season. This, for many sector businesses, was a final straw and customer confidence in buying online to receive goods in time for Christmas was completely shredded.
Cox & Cox had to make difficult but swift decisions as the series of impacts were felt. This resulted in a number of redundancies being made. The business had also sought and secured short-term external funding via loans from Hilco Capital and YouLend in order to continue trading. These loans were repaid in full last November, in preparation for a sale to a party interested in acquiring Cox & Cox. This had resulted in an initial offer being made but it was subsequently withdrawn. Further attempts to secure funding failed and Landwood Commercial was instructed to market the business as a pre-pack administration.
There was high interest resulting in the receipt of 14 parties signing NDAs and 5 separate offers, one of which was purely for the IP.
The successful bidder, Giomani Designs Limited, made an offer of £750,000 in cash to keep the business as a going concern. This was then reduced to reflect employee liabilities of £118,387 and a payment to Arrow XL of £19,540, presumably to release stock. 65 employees have been transferred under TUPE.
In a statement, the administrators said: “Upon appointment, the joint administrators successfully completed the sale of the business and certain assets via a pre-pack administration to Giomani Designs Ltd, a furniture and home furnishings manufacturer based in Birmingham. Together, the joint administrators were able to secure the transfer of 65 jobs via the sale.”
Giomani Designs operates the beds.co.uk online store which specialises in inexpensive bedroom furniture. It also sells via online marketplaces.