Jewellery and watch retailer with 21 stores goes into administration
PUBLISHED: 16:20 20 January 2019
A jewellery group with a combined turnover of more than £24m has called in the administrators.
Chapelle Jewellery & Watches, which began trading as a family business 40 years ago, has become the latest victim of the retail slump.
The company operates all of its 21 stores from outlet centres and retail parks, and has more than 250 employees. It also has three concessions, and sells a range of jewellery, watches and accessories online from its ecommerce site.
Chapelle, which is run from a head office in Nottingham, claims that it sells all of its jewellery and watches for at least 30% off the RRP (recommended retail price).
The firm sells designer watch brands including Emporio Armani, Bulova, Casia and Michael Kors.
Until recently, Chapelle operated 24 stores but closed three of them down. Its remaining stores are located at Springfields in Spalding, Lincolnshire, London Designer Outlet in Wembley, and across the North and West of England - from Bridgend in Wales, to York in North Yorkshire - and it also has two stores in Ireland.
Staff at the Chapelle store in Freeport, Braintree – the company’s only store in East Anglia - were told the news that their employer has gone into administration earlier this week.
Philip Duffy and Sarah Bell of Duff & Phelps Ltd were appointed joint administrators to both Mortimer Management Group
Limited and The Jewellery Outlet Limited, which together trade as Chapelle, on January 14.
Jimmy Saunders director of Duff & Phelps, pointed out that trading conditions for UK retailers “continue to be extremely challenging”, with the British Retail Consortium reporting the worst retail sales in December in ten years.
“Whilst the current management team has spent the last two years working hard to enhance the store estate, brand proposition and driving significant operational efficiencies, economic uncertainty continues to weigh heavily on consume confidence,” he said.
“In addition, retailers face rising business rates, national minimum wage increases and a paradigm shift in the retail landscape.
“This has impacted most retailers and as a result of trading losses, Chapelle could no longer meet its ongoing liabilities.”
Chapelle Jewellery was founded by husband and wife team Paul and Margaret Mortimer in 1979. In April 2015, it was sold to the restructuring and investment firm Hilco UK - the owner of the entertainment retailer HMV, which has also recently collapsed.
According to Smith Cooper, which managed the deal, Chapelle Jewellery was at that time “the largest jewellery retailer specialising in selling end of season jewellery and watches at discounted prices”.
More than £4m was paid out by Mortimer Management Group Limited and The Jewellery Outlet Limited in ‘administrative expenses’ for the year ending December 2017.
Recently, Hilco has faced criticism for charging high fees to HMV over the last five years - up to £48m was taken out of HMV through payments to related companies while it paid no corporation tax, which the Labour MP Clive Betts, who is leading a parliamentary inquiry into the crisis on the high street, described as “outrageous” according to the Times newspaper.
Chapelle’s co-founder, Mr Mortimer, explained that he and his wife are no longer involved in the business. “For around two years, after we left, it has been under the management of the new managing director, Tony Richards, and we have had almost no contact with anyone working inside the business management since then,” he said.
“To be honest we are very disappointed at the situation and feel sorry for the staff and suppliers who have been affected. We, and our team, built the business from one store, opened in 1998.
“Chapelle was the leader in it’s field when we sold it in 2015. It could certainly still be profitable and successful again and we sincerely hope that a retail focused buyer can be found.”
Mr Saunders explained that the intention is for Chapele to continue to trade as a buyer for the business is sought.
“We are hopeful that we will find a buyer and we are asking interested parties to come forward as quickly as possible,” he said.