Bye Bye BHS and Austin Reed?

[Fittster]

Things looking gloomy for another couple of high street names,

Austin Reed files notice for administration with 1,000 jobs at risk

BHS 'could file for administration' threatening 11,000 jobs

[Fittster]

hora said:

£571m pension deficit...

How did that happen?

BHS was doomed a longtime ago. Why would you shop there when there was Primark and H&M offering better wear for -£.

Strange, Phillip Green gets called a retail genius for his work at Topman/Topshop but he failed completely as far as I can tell at BHS (although I'm sure he probably managed to make a fortune as the business collapsed). Although he sold the business last year for a pound I read a story in a paper somewhere that it won't get him off the hook for the pension deficit. Apparently the pensions regulator has some teeth.

[Fittster]

Sheets Tabuer said:

techiedave said:

I honestly can say I haven't ventured into a branch of BHS in the last 5 years
They exist but just don't seem to have any relevance

If I was 82 I'd use them a lot.

Bon Marche have stolen those customers.

[Fittster]

kiethton said:

Phillip Green did exactly what BMW did to MG Rover, take the good bits - Topshop etc, take the better stores for his other brands and then leave the remainder under-invested until somebody else takes it on for a token amount and takes the liabilities with it.

If he's smart it'll have been separated as a separate company yonks ago, leaving all liabilities with it.

Topshop and BHS appear to have come from different places:

1. 2000: Retail billionaire Sir Philip Green buys BHS from Storehouse Plc for £200m
2. 2002: BHS becomes part of the Arcadia empire, controlled by Sir Philip, when he buys the clothing group and its Topshop, Dorothy Perkins and Burton brands
3. 2005: The store resurrects its "British Home Stores" branding, but it is losing ground to cheaper rivals like Primark
4. 2015: Sir Philip sells the loss-making BHS for £1 to Retail Acquisitions led by Dominic Chappell, writing off £215m of debts in the process
5. 2016: BHS begins an insolvency procedure to reduce its rents and transfer its pensions liabilities into the Pension Protection Fund, the government-supported rescue agency

[Fittster]

mjb1 said:

I think a big part of the problem stems from historical overgenerous pension schemes, that only appeared sustainable whilst a business was expanding at a decent rate. As soon as it matures and the no of employees levels off (or decreases), there's not enough people paying in to maintain the pension pot. The current (and subsequent) working population is going to be footing the bill for a lot of the current retired population for a long time. We're working longer, and have to pay in more to get less out. The try to justify it by saying we're all going to live longer and healthier, but I think life expectancy in the developed world is about to plateau - most of us have far unhealthier lifestyles than our recent ancestors. Not just diet, but exercise, working hours/pressures, financial pressures (it's unusual for a couple to have just one bread winner these days). There's only so much medical science can do.

Every time a big corporation/industry fails, there's usually a massive pension deficit lurking in the background. I've known otherwise successful medium to large businesses sold 'cheap' to overseas investors because of a huge pension deficit acting as a millstone.

You don't think the money taken out of the business by shareholders and managers could be a problem? If less had been removed through those paths then there would be more for pensions.

What we'd need is a large high street retailer (say maybe a department store) where the staff control the business rather than short termist managers and shareholders. A business such as that could put customers and staff first.

If only there was such an institution that could act as an example to others……