August 4th 2023.
As shoppers anxiously await the outcome of Wilko's financial troubles, the future of the popular discount chain remains in limbo. With the company filing a notice of intention to appoint administrators in the High Court, it gives them a 10-day window of protection from its creditors to try and secure funding.
Wilko is often seen by shoppers as a successor to much-loved Woolworths, which closed down in the UK in 2009, offering a huge range of goods from homeware to toiletries and the ever-popular pick and mix. Unfortunately, the recent bare shelves and announcement of job cuts in February signalled that the store was in trouble.
What does 'going into administration' mean? This is a legal process in which an administrator is appointed by the directors, a creditor or the court. They take control of the company and everything it owns in a last resort attempt to save the business. If saving it isn't possible, they will try to claw back as much money as possible for creditors without immediately winding it up. This could involve allowing the company to continue to trade for a period, while seeking to sell the business or assets such as goodwill, trademarks, patents, equipment, the customer database, software, content or websites. If neither of the above options work, they can liquidate the company.
Wilko's chief executive Mark Jackson said that they have had 'a significant level of interest', including offers that would meet their financial criteria to recapitalise the business. However, they don't have an offer that provides the necessary liquidity.
At present, no closures have been announced, but whether Wilko remains on the high street will depend on what happens in the next few days and weeks. If funding can't be found, and Wilko enters administration, the adminstrator has 8 weeks to write a statement explaining what they plan to do.
It's too soon to tell whether Wilko will remain on our high streets, but shoppers can only hope for the best. If it does end up closing, it will join a growing list of stores that have disappeared from the UK high street, such as Woolworths and British Home Stores. Only time will tell!
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