Troubled fashion chain, French Connection announced losses of £15.1m for the first half of 2018, including provisions of £2.8m of bad debt resulting from the collapse of House of Fraser. In August, administrators EY released documents showing that the failed retailer owed suppliers a total of £484m.
House of Fraser was later bought by billionaire retailer Mike Ashley the founder of Sports Direct for £90m, but since the purchase was of the stores, stocks, and brand and not of the company as a going concern, unsecured creditors will have to apply to administrators for their share of the winding up proceeds, should there be any left after secured creditors and employees are paid. (Article - 'What to do if a customer goes into adminstration owing you money')
Samantha White, CEO of My Credit Controllers said:
"This episode shows that even large companies can get caught unawares when customers unexpectedly go into administration owing them money. The best defence is to be vigilant and keep an eye on the financial health of your credit customers, and to implement good credit control procedures in your business to minimise the amounts outstanding at any time."
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