Carpetright is on the brink of collapsing into administration, putting thousands of jobs at risk.
The major carpet and tiling retailer, which is headquartered in Essex, has filed a notice with the High Court that it is seeking to appoint PwC to oversee the process.
The move gives Carpetright 10 working days to either secure a rescue deal or it will enter administration.
The company would follow the likes of The Body Shop, Ted Baker and online luxury fashion retailers Matches and Farfetch into insolvency.
Carpetright currently runs around 270 stores across the UK while reports have suggested anywhere between 1,800 and 3,000 jobs are at risk.
In its most recently filed set of accounts, for the 14 months to January 1, 2022, Carpetright reported a revenue of £372.6m, down from £493.2m in the prior 18 months, while its pre-tax loss was cut from £64.3m to £23.1m.
Its accounts for 2022 were due to be filed with Companies House by the end of 2023 but are late.
Carpertright launched a CVA back in 2018 which entailed 81 store closures, rent reductions and business restructuring in order to stay alive.
Carpetright ‘another high profile casualty’
Rebecca Dacre, partner at Mazars, said: “We are unlikely to see the retail sector trading comfortably until interest rates start to fall.
“Despite inflationary pressures easing, high interest rates and low consumer spending continue to persist.
“The rise in the National Living Wage is the largest on record and some face a sharp rise in business rates from April.
“One of the issues that chains like Carpetright will face is who will want to rent their excess space.”
Jasvir Jootla, restructuring and insolvency partner at Gowling WLG added: “This is another high profile casualty in the retail sector, highlighting the continued cash pressures retailers face, as well as a decline in sales with consumers looking to cut back discretionary spend.
“It further demonstrates that even well-established brands are not immune to the current challenging environment.
“Being one of the UK’s largest floor covering retailers, we would expect that the business, in a reshaped form, can be rescued through an insolvency transaction, which will ultimately help to save jobs.”