Missguided, the online fashion specialist, has called administrators after failing to get a rescue offer.
Teneo administrators were appointed on Monday after the company received a liquidation request from clothing suppliers to whom they owe millions of pounds. About 140 jobs are believed to be at risk and a source says more than 80 people were fired immediately.
Boohoo, a senior online fashion specialist, had been in talks to buy Missguided in a prepackage management deal, while JD Sports and Asos are also believed to have taken a look, but a deal could not be closed. .
Managers said Missguided would continue trading as they seek to complete a sale of the business and assets.
Gavin Maher, CEO of Teneo, said: “The retail business environment in the UK remains extremely difficult,” but added that Missguided had generated “a high level of interest from a number of strategic buyers”.
The company continued to receive orders on Monday, but it was unclear whether the group’s distribution partner, GXO, continued to handle those orders.
Some of the online retailer suppliers in the UK and abroad told the Guardian that they had not been paid for months and several said they had already been successful in December when they were asked for a 30% discount on orders already agreed.
A Leicester-based factory owner said he was owed more than £ 2m and had been forced to send his more than 90 workers home because he could not pay them. He said that without paying he could be forced to convene administrators as he had not been charged since April. “This is completely unethical,” he said. “I’m absolutely upset.”
Another Leicester supplier said he owed £ 600,000 and was unsure whether the business could survive without Missguided’s orders, which accounted for the vast majority of his work. “I have already fired 10 people. It’s hard to pick up other jobs because of the economy right now – customers aren’t hiring new suppliers, ”he said.
“This will have a big impact on our business. We’re not sure we can operate because we have to pay our suppliers. It’s just impactful.”
Founded in 2009 by Nitin Passi, Missguided was among a small number of successful Internet fashion brands at a time when shoppers were increasingly turning their backs on the traditional street.
The business was set up with a £ 50,000 loan from Passi’s father, who was originally from India and made a fortune creating the big street vendor By Design after arriving in the UK in the 1960s.
During the pandemic, the company enjoyed rapid growth, but has struggled since physical stores reopened and purchasing power has been hit by the cost of living crisis.
Last fall, the online retailer was saved from collapse when retail investor Alteri, backed by investment firm Apollo, intervened.
Last month, Missguided said it was looking for a new investment when Passi stepped down as CEO.