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A ‘hammer blow’ for Lochaber is how the impact of any permanent closure of the region’s two branches of Edinburgh Woollen Mill was described this week.
The future of Edinburgh Woollen Mill (EWM) shops in Fort William and Spean Bridge, as well as Oban, hangs in the balance after 24,000 staff across the entire UK group were notified on Friday of its plans to go into administration unless a rescue solution can be found within 10 days.
Long before the coronavirus, EWM had warned in its annual report of March 2019 of ‘extremely challenging trading conditions in the UK’, due to the surge in online shopping and reduced footfall in town centres. Bosses have now admitted that a combination of lockdown and then further local lockdowns had meant normal trading had become impossible.
EWM depended on the international overseas visitor market which had collapsed this year because of the pandemic. Furthermore, loyal customers from the visiting coach tours market had also taken a huge hit this year too.
EWM has now filed ‘a notice of intent’ with the High Court to appoint administrators. Papers have been lodged which effectively buy it 10-days of time before creditors can swoop. It is now in urgent talks with business experts to review its future.
It puts the future of hundreds of stores and outlets in doubt in a group headed by Switzerland-based billionaire Philip Day. The group includes subsidiaries such as Jaeger, Ponden Home, and Peacocks.
Councillor Andrew Baxter, who represents Fort William and Ardnamurchan ward on Highland Council as well as being chairman of the council’s Lochaber Area Committee, said it was a difficult time for staff of the branches in Fort William and Spean Bridge which have remained closed during the coronavirus health crisis.
‘This is a worrying time for the staff working in the Fort William and Spean Bridge stores. I know they are popular places for visitors to Lochaber, who like to return home with a wee memento of their visit to Scotland,’ said Mr Baxter this week.
‘It will be a real hammer blow to see these stores close. I hope a rescue package can be secured. Unfortunately, I think the upcoming months will see many other local businesses face an uncertain future.’
Federation of Small Businesses (FSB) Highlands and Islands Development Manager David Richardson told the Lochaber Times the company’s decision to go into administration would worry traders right across Scotland, not least in Fort William and Spean Bridge.
‘Their shops tend to act as magnets, pulling people into high streets, people who go on to spend money in a range of other businesses,’ added Mr Richardson.
‘Not only that, but at this dangerous time for businesses, economies and communities, the last thing we need is more unsightly empty units with ‘To Let’ signs on our high streets, and more people out of work. Let’s hope that a solution is found quickly.’
EWM has called in FRP Advisory, which specialise in corporate finance, debt, restructuring and pensions, but can also act as insolvency practitioners.
Lochaber constituency MSP Kate Forbes told us: ‘There are Edinburgh Woollen Mill stores across my constituency, including those in Fort William and Spean Bridge, and the announcement that they are going into administration has been devastating for all concerned – especially staff members and their families and friends.
‘I have spoken to Jamie Hepburn MSP, the Scottish Government’s Minister for Business, Fair Work and Skills, and he confirmed that Skills Development Scotland have contacted FRP Advisory to offer PACE support if that should be required.
‘I hope that all options can be pursued in the hope that no stone is left unturned for the business.’
EWM chief executive Steve Simpson said in a statement that the group had a duty to find ‘the very best solution’ in the current ‘brutal environment’.
The statement read: ”As directors, we have a duty to the business, our staff, our customers and our creditors to find the very best solution in this brutal environment.
‘We have applied to court for a short breathing space to assess our options before moving to appoint administrators.
‘Through this process I hope and believe we will be able to secure the best future for our businesses, but there will inevitably be significant cuts and closures as we work our way through this.
A spokesman for business experts FRP said: ‘Our team is working with the directors of a number of the Edinburgh Woollen Mill Group subsidiaries to explore all options for the future of its retail brands Edinburgh Woollen Mill, Jaeger, Ponden Home, and Peacocks.’