Discount retailer Poundworld has appointed administrators, putting 5,100 jobs at risk after talks with a potential buyer, R Capital, collapsed leaving the company with no option other than administration.
Poundworld, which serves two million customers a week from 335 stores, also trades under the Bargain Buys name.
Administrators Deloitte stress the stores will continue to trade as normal with no redundancies at this time.
It said in a statement: “Like many high street retailers, Poundworld has suffered from high product cost inflation, decreasing footfall, weaker consumer confidence and an increasingly competitive discount retail market.
Clare Boardman, joint administrator at Deloitte, said: “The retail trading environment in the UK remains extremely challenging and Poundworld has been seeking to address this through a restructure of its business.
“Unfortunately, this has not been possible.”
She said Deloitte believed a buyer could be found for the business, or at least part of it.
A spokesperson for Poundworld”s owner, TPG said filing for administration had been “a difficult decision”.
“Despite investing resources to strengthen the business, the decline in UK retail and changing consumer behaviour affected Poundworld significantly,” they added.
Poundworld has been losing money for the past two years. Losses for the financial year 2016-17 were £17.1m, up from £5.4m the year before.
It’s the latest High Street retailer to run into trouble.
Just last week, department store chain House of Fraser said it would close 31 of its 59 shops, citing the need to adapt to “fundamental change” in the retail industry.
A combination of falling consumer confidence, rising overheads, the weaker pound and the growth of online shopping have made it tough for traditional retailers.
Other High Street chains such as Mothercare and Carpetright have been forced to close stores in order to survive.
Restaurant chains such as Italian chain Carluccio’s, pizza restaurant Prezzo and burger chain Byron have also had to close stores as they battle a triple-whammy of falling trade, higher costs and increased competition.