Last month the online platform had sought financial bail at the eleventh hour
Robbled online retailer Made has succumbed to financial pressure and has put itself up for sale amid a massive downturn in the home goods market as consumers face cost of living crises on big-ticket items.
Shares of the trade were down nearly 30% in morning trade.
The group, originally founded by former LastMinute boss Brent Hoberman and investor Ning Lee, indicated it hit rocks last month as it sought an eleventh-hour cash injection from investors to shore up its balance sheet. Hoberman and Lee have since left the business.
MED said: “While the Group has had a number of strategic discussions with interested parties, the Group is not in receipt of any approach at the time of this announcement, nor is it in discussions with any potential proponents”, but it has now reached It was decided that one of its future options was to enter a “formal sales process”.
Med’s boss Nicola Thompson said: “Med is not alone due to problems in the supply chain and reduced cost of living, but we are taking action to ensure our continued success, backed by our strong brand, of an outstanding product. A large and loyal customer base across the chain and multiple markets.”
The group’s shares have declined nearly 95% in value over the past year, with the group instructing advisors at PwC to explore restructuring the group and implement potential cost-cutting — including redundancies. .
At the time, the retailer said it would “consider all options to strengthen its balance sheet”.
Made said: “The first headwind is a decline in discretionary consumer spending due to increased inflation and a sharp decline in consumer confidence.
“During the first half of 2022, MED’s core markets experienced adverse developments in macroeconomic conditions, including an economic slowdown, rising commodity inflation and energy prices, driven by Russia’s invasion of Ukraine, which More uncertainty about the duration and further downside has been caused by these unfavorable conditions and other contributing factors.
“These unfavorable market conditions have caused a sharp decline in consumer confidence and contributed to a significant withdrawal of consumer discretionary spending.”
The business said it had found itself needing to sell heavily discounted goods to address inventory levels to accommodate those “unfavorable market conditions”, but also found itself in an “overstock” position on inventory due to the recession. was found. consumer expenditure.
It also said that the economic slowdown had made it “challenging” for the group to acquire new customers at financially attractive rates, resulting in “high customer acquisition costs” and “supply chain instability resulting in reduced credibility and increased cost”.
The company said the cost of freight has increased from £8.2 million in 2020 to £45.3 million in 2021.
Credit: www.standard.co.uk /