Fri, 21 Jun 2013 | ADMINISTRATION
Furniture retailer Dwell has collapsed following a drawn-out period of doubt over the company's future.
The firm has struggled with cashflow recently due to the current uncertain economic situation and a challenging set of trading conditions in the household goods and furniture sector. It was originally hoped that the firm would be sold as a going concern but following its collapse today (Friday, 21 June), Dwell is expected to appoint administrators early next week with Duff & Phelps already lined up to handle the matter.
Dwell was founded in 2003 by Aamir Ahman who used £50,000 from an earlier failed venture and a £100,000 loan from his father to kickstart the business, which designed the majority of its furniture in-house. Within the decade the business had grown from a single shop in Balham, London to a retailer with nearly 20 outlets and a successful online business. It posted a turnover of more than £25 million a year and in 2010 was on track with an expansion plan following the sale of a minority stake in the business.
However, cash started to dry up and last year Mr Ahmad resigned as managing director following a refinancing of the company in November.
A spokesperson for the firm commented: “The business had been working with its advisers to secure further working capital for the business and was actively talking to a number of interested parties who saw the value of the Dwell brand and product, its customer base and its multi-channel proposition. However, despite this interest, it did not progress.
“As a result, we have been left with no option but to close the business with immediate effect.”
For now Dwell has asked its 300 employees to stay at home until administrators are able to offer more information on their positions. Customers who have placed an order with the firm are also being kept in the dark about whether or not they will receive a refund. Dwell has cancelled all deliveries and urged anyone who has placed an order with a credit card to contact their bank for a refund, while no promises have been made to other buyers about whether or not they will get their money back.
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