A British online footwear marketplace entered administration last month, but has now been rescued. Laced Europe Ltd operates as a platform for trading rare trainers and luxury goods from some of the world’s biggest brands, including Nike, Adidas, New Balance and Supreme.
Founded in 2015, it helped connections between buyers and sellers of exclusive items. The company’s turnover was reported as £9million this year. However, Quantuma’s Terri Mulgrew and Michael Kiely were appointed as joint administrators on September 22.
Laced had faced numerous challenges in recent years as its period of growth was followed by worsening market conditions. The business became dependent on achieving high transaction volumes to sustain its cost base after expanding its workforce, warehouse capacity, marketing and technology expenditure.
In 2022, declining consumer spending, inflation, heightened competition and rising courier costs impacted sales and profit margins. Management made efforts to cut costs, but ultimately, the company exhausted its working capital.
It proved unable to secure additional investment and could no longer satisfy its liabilities, resulting in insolvency. Following the appointment of administrators, a pre-pack sale has been completed, safeguarding all jobs and ensuring the future of the business.
The sale has resulted in all seven employees being transferred to the purchaser, A Beauty Inc Ltd, part of the AA Investments group, under TUPE regulations.
A spokesperson for the AA Investment Group said: “Laced is a strong brand with a real community behind it. We are proud to continue this journey and to welcome the team into the AA Investments family.
“Customers and sellers can continue to use the platform as service is coming back step by step while we work on its next chapter.”
Terri Mulgrew, joint administrator and associate managing director at Quantuma, added: “I am very pleased to have achieved such a positive outcome for this online retailer, ensuring that all employees’ jobs have been saved.
“We are delighted to have secured the long-term viability of the business, allowing it to continue its journey. We wish the team every success in their next chapter.”
When do companies enter administration?
Businesses can enter administration when they are unable to settle their debts, a situation known as insolvency. Payments to creditors or anyone owed money by the company are suspended throughout this process.
Plans to restructure the firm are developed, and an administrator from a qualified accountancy practice takes control. They oversee operations until a new owner can be identified.
Creditors must receive as much repayment as possible, which is generally achieved through asset sales. Administration is a lengthy procedure and can take several months.