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And if you’re saying that’s a good week, whilst I appreciate those won’t be their only sales what’s the average margin per bike …. £100????
It’s not like they’re billing £20k a week, then take out staffing, rent, rates, heat, light ….. etc, etc etc …. not surprising it’s a business that struggled to survive as the online competition intensified.
My point there which either I failed to make properly or you failed to pick up on was that the majority of the shop business was cheap bikes. People literally couldn't have cared less if the bike said Specialized or Trek or Kona or Marin on the downtube: they had £400 to spend and they found the one they felt looked nicest / fitted best.
Maybe part of ther problem was actually that Evans stocked [b]too many[/b] brands - it became difficult to differentiate between the offerings at the lower price point and customers were often left with a choice of 4 bikes rather than a choice of 2.
I believe "as a going concern" is more to do with protection of creditors and the capability of the business to carry on. It doesn't mean that it will carry on, what Ashley does with his new toy is up to him.
I assume TUPE applies?
TUPE will apply, yes. That is a matter of EU law and so does not involve the same concept of what a business is as the concept of a "going concern" in business and insolvency law. Not my area, so I wouldn't like to say which is the broader definition, but my guess would be TUPE.
Well it could have been eight quid, or two, like BHS was sold for.
Very true, but comparing their situation to BHS is setting a staggeringly low bar!
“Evans has been bought out of administration as a going concern”
Has it?
Apparently 2 of the 8 million has gone into the business so yes it would be a going concern. Going concern is a technical phrase that means the business is sufficiently capitalised in order to continue trading and service its debts for some period of time... I don't think that has a specific timeline mind.
Does anyone have any idea what this means for bikes on order? Bought and paid for a bike for my daughter due for delivery on Friday? Will she see it or should I be contacting the credit card company?
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For bikes on order it’s up to you and them whether the new company will want to honour your order or not. Ask.
Warranties and outstanding orders, deposits are being honoured. It was discussed and confirmed RE Pinnacle bikes.
@benpinnick I am not sure what the phrase means in the context of a pre-pack. Clearly Evans was not a going concern, so the administrators didn't have anything that could be sold as such. Only the injection of further cash can turn it into a going concern. Would the deal with the administrator have obliged SD to inject that cash? Or to put it another way, was the business sold as a going concern, or sold as a basket case which was then, by choice of the purchaser, turned into one?
Im not sure either, I am sure you could line up your transactions in such a way that the business was a going concern for the few seconds it took you to sign the next piece of paper. However there is the bigger issue of then announcing 50% closures. That would, at least to my mind make a mockery of the concept of going concern, even if its still technically correct.
I'm beginning to wonder if my Specialized Shoes are going to turn up on the forecast date of December or even if they'll show up at all? I've got £150 credit in those shoes due to a previous pair ordered not fitting. Wondering whether just to buy something else for now and go elsewhere for the shoes......
Just picked up my bike. Sign on counter stated that gift cards are no longer being accepted.
I am not sure what the phrase means in the context of a pre-pack. Clearly Evans was not a going concern, so the administrators didn’t have anything that could be sold as such. Only the injection of further cash can turn it into a going concern. Would the deal with the administrator have obliged SD to inject that cash? Or to put it another way, was the business sold as a going concern, or sold as a basket case which was then, by choice of the purchaser, turned into one?
The way I understand it that in this case the business retains continuity which I think some people are confusing for being a 'going concern'. Clearly if the business had sufficient liquidity it wouldn't have been sold as a pre-pack by the administrator. Some creditors must have lost out here even if the business is now a going concern thanks to SD cash injection. Ashley isn't going to pay (old) creditors he doesn't have to. You don't get to be a billionaire this way.
Interestingly Evans Cycles has now disappeared from Quidco, was there yesterday.
Their price match took longer than usual to come through, small signs of new changes perhaps.
But I've had the displeasure of having to deal with shoddy customer service from Agent Provocateur another of MA's takeovers. It took me a whole 1 1/2 years of chasing to get a full refund (which they don't do btw).
Just spoke with Evans Customer Service as Sparks said cannot use gift cards for the forseeable future.. tguess I can write the 8 quid off!
now disappeared from Quidco
and currently suspended on my work 'Additions' discount scheme.
Quidco on top of price matching always felt too good to be true!
They have just price matched some pedals and helmet for me but going in store to collect.
They have just price matched some pedals and helmet for me but going in store to collect.
at this point I'd have to guess that it's either sell whatever/however to generate cashflow or the staff don't give a shit
I would not blame them sorry time of year for this type of news.
Might pop in and offer them a crisp handshake for the most expensive bike left in the shop 😂
@jameso thanks for the info and what’s the future for pinnacle? It was a pinnacle we got as was a great option. To be honest it was the best available.
I'd love to see Pinnacle escape and either go it alone or be picked up by someone else (Zyro Fisher, perhaps....) as an in house brand, like Genesis at Madison. Would be a shame to see it dragged down to Ma's level as it's a good brand making some good bikes.
Pinnacle and Genesis are more closely related than you may realise.
Or to put it another way, was the business sold as a going concern, or sold as a basket case which was then, by choice of the purchaser, turned into one?
The way I understand it that in this case the business retains continuity which I think some people are confusing for being a ‘going concern’. Clearly if the business had sufficient liquidity it wouldn’t have been sold as a pre-pack by the administrator. Some creditors must have lost out here even if the business is now a going concern thanks to SD cash injection. Ashley isn’t going to pay (old) creditors he doesn’t have to.
As said before, main reason for agreeing pre pack admin will be to wash your hands of every cost you don't want, leaving those unwanted bits for the administrators to deal with ( 30 unwanted stores with long term lease agreements and their staff redundancy costs, outstanding debt).
Thereafter, negotiate with suppliers depending on how important they are to you in future. A) stick two fingers up> leave administrators deal with, or B) negotiate out of RoT, agree to pay a debt or part of, to keep the supplier relationship.
I'm only assuming that's how it works, happy to be corrected?.
I’d love to see Pinnacle escape and either go it alone or be picked up by someone else (Zyro Fisher, perhaps….) as an in house brand, like Genesis at Madison.
Pinnacle is Evans own-brand so they ('they' as in the Evans post-sale) own the TM. Can't see them selling it as the brand is valuable to Evans, also based on solid VFM bikes via a fairly customer-direct model and a distributor to IBD route to market can't be as competitive these days.
Thanks for the positives though... I want to see the good things we've done with Pinnacle continue.
Just been in to my local Evans to pick up a click and collect order I placed a couple of weeks ago. As above a sign on the counter indicating vouchers not being accepted for the foreseeable future, and not available to buy. The mechanics were busy but no other customers and the shop seemed very quiet
@B.A.Nana
As said before, main reason for agreeing pre pack admin will be to wash your hands of every cost you don’t want, leaving those unwanted bits for the administrators to deal with ( 30 unwanted stores with long term lease agreements and their staff redundancy costs, outstanding debt).
Thereafter, negotiate with suppliers depending on how important they are to you in future. A) stick two fingers up> leave administrators deal with, or B) negotiate out of RoT, agree to pay a debt or part of, to keep the supplier relationship.
I’m only assuming that’s how it works, happy to be corrected?.
I think the new owners will take free of all past debts, the 8 million paid to the reciever will probably cover those. As for redundancy payments, as they took over all the business, all employees retain their employment rights against the new owners under TUPE and so the new owners will have to fork out for redundancy payments.
Not sure about the leases, possibly arrangements with the landlords remained to be negotiated. Often leases terminate automatically on an insolvency. So the options for the new owners would be agree to take over the lease*, or let it go (landlord terminates and repossesses).
*Ashley did comment to the effect that he would be entering into negotiations with landlords, presumably running the "offer me a reduced rent/ rent holiday or this will be one of the stores I let go" argument.
I’d love to see Pinnacle escape and either go it alone or be picked up by someone else (Zyro Fisher, perhaps….) as an in house brand, like Genesis at Madison.
You do know Zyro-Fisher are for sale or certainly were a few months back.
Not sure if anyone else has posted, but I just got some Tesco Clubcard vouchers and found that the Evans deal has ended 🙁
Apparently SD got 28m worth of stock for 8m quid. Bargin.
Did they have 8M worth of Tesco vouchers?
Apparently SD got 28m worth of stock for 8m quid. Bargin.
Yes but commitment for rent / wages etc. ... whilst it might seem that simple on the surface there'll be underlying expenses that need to be met or someone else would have bid 10 / 12 / 18 million for it (Halfords ???)... he's probably taking the stock value (which has probably been over inflated) as something to offset other costs.
Mr Ashley is soon to be the only person that actually owns anything on the high street as every other shop is closing ... it'll be interesting to see in 5 yrs if his .... what I perceive to be as an massive gamble ... plays out as it should as how can you survive in retail when every other shop is going bust???
The only thing a high street (although there may not be any left in the future) can do is promote your name / act as a form of advertising just by being there to help promote online sales.
If I had shares in anything he owns personally I think this is the point I'd probably sell them and wonder if he may have over stretched himself in a massively diminishing market unless it's a springboard into taking them all online.
is that 28m in value or RRP? What does he have to pay the supplier on that?
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… it’ll be interesting to see in 5 yrs if his …. what I perceive to be as an massive gamble … plays out as it should as how can you survive in retail when every other shop is going bust???
As I explained earlier in the thread, Evans didn't go bust due to any fault in the business model, or because of online competition, or anything like that- it went bust because last time it was bought out by a private equity company they saddled it with unrepayable debt at crippling interest rates, payable to themselves. They would still be trading today had they not been bought by sharks, just like Maplin.
So it's not really a gamble for Ashley, it's just a case of exploiting the damage caused by a different sort of shark.
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The only thing a high street (although there may not be any left in the future) can do is promote your name / act as a form of advertising just by being there to help promote online sales.
If I had shares in anything he owns personally I think this is the point I’d probably sell them and wonder if he may have over stretched himself in a massively diminishing market unless it’s a springboard into taking them all online.
George A Romero set Dawn of the Dead in a shopping mall as he said that when zombiefied and most of the brain died, people would return to habit or flickers of memory and hence they all lurch toward the mall.
Look at most malls or town centres now, people often go there whether they're spending or not, or pass through fairly regularly. If you can buy at online prices from a familiar name while you're there, why wouldn't you? Some people get more from online shopping as it's easy, some enjoy retail shopping as an activity. Retail:Online mix will continue to change in future but showrooms will always be an advantage for some and bikes are difficult to sell online only.
What James said.
Apart from the DOTD bit... 😉
Exactly what jameso said. Most high streets area dieing yet meadowhall is getting a 300 million expansion. There's already a sports direct, a Debenhams, a JD sports and a house of Fraser, wouldn't surprise me at all if an Evans pops up there too.
Exactly what @northwind said.
Ashley and/or the previous VC owners are only interested in the deal. The bottom line. How much money can they make. Customers are merely a conduit for money into the SD coffers.
There's an interesting piece in today's papers about the number of staff Ashley has dispensed with and the amout of debt he has walked away from.
But, look on the bright side. Philip Green has ensured that Ashley will never be given a knighthood.
Meadowhall will juat become a massive apple store i predict one of the shops i worked in there as a student had the highest retail cost per foot outside of london and it was comparable with oxford street ironic the biggest sellers were proflexes animal watches berghaus jackets and timberland boots..
George A Romero set Dawn of the Dead in a shopping mall as he said that when zombiefied and most of the brain died, people would return to habit or flickers of memory and hence they all lurch toward the mall.
But will they return .... I reckon older people might but younger people default to online
My daughter orders 3 dresses, tries them all on and sends 2 back and this is becoming the new norm with the youngest not even discovering what a high street actually is to have any wish to return to it.
That's not me saying I'm right and you're wrong and I hope it's me that's wrong as I think the loss of shops is a great shame.
Why manufacturers / suppliers don't make retailers stick to recommended retail price which would give the shops back a margin they could survive on.
Whilst there's the convenience of online shopping most people probably buy online because of the discounting and it'd take that advantage away.
Why manufacturers / suppliers don’t make retailers stick to recommended retail price
Because price fixing is illegal
@jameso - did this affect the development of new Pinnacle products? Anything coming soon that you can share with us?
younger people default to online
It's a marketing-by-numbers myth that people's habits or interaction with brands, marketing etc vary that much with age. People vary, that's all. It just comes down to a balance of convenience, personality etc. What we do seem to agree on is that people research more online then may buy in store and retail outlets can do things that a screen can't, particularly with bikes. Question is how much of your business costs are based in the retail premises side of it and how that works with online sales, info etc. Evans is in a good position there, has been for a while and could be doing a better job of it (see points here about need for investment to maximise that).
Why manufacturers / suppliers don’t make retailers stick to recommended retail price which would give the shops back a margin they could survive on.
As above, it's illegal and as you say, a product's value is set by online pricing anyway.
@jameso – did this affect the development of new Pinnacle products? Anything coming soon that you can share with us?
All MY19 is done and day to day work on future changes and ranges hasn't changed. MY19 info hasn't all gone out yet, some could have been out this week but it'll be next week and afterwards now.
I got a gift card yesterday for me birthday, must have been bought in the last few days & probably now worthless - if it is I'll be tempted to place a massive order to collect in store then then throw a big strop & cancel the lot when they won't accept it. Petty, yep.
@mcj78 - The thing is it's not the poor sod on the shop floors fault is it? No need to be an arse with them when they can do nothing about it and there's a good chance of them being made redundant ☹️
Agree through gift vouchers are a joke. We got some for toys r us from a friend for one of the kids birthdays just before they went bust. Had to pony up the cash ourselves. I don't see why people don't just give cash in this day and age of retail companies going bust left right and centre .