This retailer operated from seven shopping centre units and traded profitably for many years before becoming loss making following the onset of recession.

The critical issue faced by the company was being tied into long term upwards only onerous leases at far above market terms. All other variable costs of the business were successfully reduced in line with turnover by the directors but the company was unable to reduce its main overhead; rent.

The company entered Examinership and the weakest trading store was immediately closed. Negotiations took place with other landlords using the framework of the Examinership and reductions of between 50 – 80% were achieved. The reductions were sufficient of themselves to turn around the company’s fortunes and render the company profitable.

A cash business, the company operated at a surplus during the protection period and utilised that surplus to fund a scheme of arrangement for all creditors. The company emerged debt free following the 100 day process with six stores still trading and 25 jobs intact.