Footwear suppliers are seeking reassurances over the future of high street chain Barratts this week, following news it could go bust for the third time if it does not secure an emergency loan.
Owner Michael Ziff is believed to be trying to secure a £3m loan to help pay for stock in the run-up to Christmas. Ziff has approached turnaround investors and asset based lenders for the funds but industry sources were not optimistic.
Barratts’ 75-store estate could struggle to generate enough cash to survive if stock fails to arrive for the festive period. It is currently offering 20% off everything on its website, which is believed to be a move to improve liquidity.
The managing director of one footwear brand that supplies Barratts said: “They aren’t talking to us at the moment, but we need clarity on what they are up to.”
Stephen Sidkin, partner at law fi rm Fox Williams, said suppliers could be left significantly out of pocket if Barratts does not secure the loan. It is not known whether Barratts has credit insurance. He added: “Suppliers to Barratts who have not secured payment or retained title to goods supplied will be looking at this situation with trepidation. Trading to Christmas is one thing, but how confident will suppliers be when it comes to delivering against spring 14 orders?”
Bradford-based Barratts has filed for administration twice before, most recently in 2011, when more than 2,000 employees lost their jobs. Ziff bought 90 stores out of administration, saving around 1,200 roles.
Barratts was not available to comment.