Newspaper article The Journal (Newcastle, England)

Disaster for One of the Region's Success Stories as Administrators Are Called in at Collectables

Newspaper article The Journal (Newcastle, England)

Disaster for One of the Region's Success Stories as Administrators Are Called in at Collectables

Article excerpt

Byline: Ian Robson Reporter ian.robson@ncjmedia.co.uk

ALEADING North East business became the victim of hard trading conditions yesterday when administrators were called and 25 staff made redundant.

It is hoped the giftware company Collectables, which has 11 shops in the region, will be sold to new buyers.

But it was too late for the staff at the company's head office at Blaydon, Gateshead, who were the first to get their notices.

Yesterday it emerged that the company's 200 staff had not been paid and will be forced to rely on a Government scheme to claim some of their redundancy payment.

Administrators KPMG said Collectables simply did not have enough money either to pay staff or buy in stock to cover them for the busy Christmas sales period.

A spokeswoman said: "This company is no different than any other. Their cashflow situation is so bad they cannot afford to pay creditors including staff wages.

"Employment specialists have been brought in to offer advice on how to claim redundancy payment through a Government scheme. Staff at Collectables should be able to claim redundancy payments to some level through the scheme."

Experts are now trying to assess if the business can be saved and a buyer found.

Staff reacted with shock yesterday saying the news came as a surprise.

Founder Philip Lewis launched the enterprise in 1986 when his previous business collapsed.

Collectables started off from one barrow, then two, and grew to become one of the North East's success stories.

Up to now the business had been bucking the trend and riding out the economic crisis.

A spokesman for the administrators said there would be no immediate redundancies, but could not rule them out in the future.

Jonny Marston, one of three joint administrators, said: "Sustained dif-ficult trading conditions have resulted in the business facing cash pressures with a further increased demand for working capital in preparation for the Christmas trading period. …

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