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Woolworth into administration

Robert Peston | 17:07 UK time, Wednesday, 26 November 2008

I have learned that Woolworth, one of the UK's best known and oldest store groups, will tonight file to go into administration under UK insolvency procedures.

WoolworthsThe board will meet at 6pm to take the formal decision.

Deloitte will be appointed as administrators to the store chain and also to Entertainment UK, which supplies books and DVDs to supermarket groups.

However Woolworth's joint venture with the BBC will not go into administration. It is owned by Woolworth's top company, which will not go into administration.

The collapse of Woolworth is likely to lead to the closure of hundreds of stores across the UK.

And it is also likely to lead to many thousands of redundancies.

Woolworth has 815 stores. The store chain employs 25,000 and Entertainment UK employs 5,000.

The company has struggled under the weight of £385m of debt. Its problems were compounded over the past couple of months when it was forced to pay cash when buying goods from suppliers, because trade credit insurers were no longer prepared to insure supplies to Woolworths.

UPDATE, 05:29 PM: For the millions of us who have grown up on Woolworth pic'n'mix and bought Power Ranger toys from them for our kids, the collapse of the store chain will bring great sadness.

And of course the pain and anxiety is much greater for the 25,000 employed in its stores.

So since the government has recently made such a great fuss about keeping small businesses alive, why didn't ministers try to keep such a substantial retailer afloat?

As it happens I understand that Peter Mandelson, the business secretary, had contact with the company today - to ensure that if it went into administration, it would minimise the anxiety to its employees, it would do what it could to protect its pension fund and it would keep its stores open if possible during the vital Christmas period.

But Woolies has been something of a lame duck retailer for years. It has been losing market share against intense competition.

And government policy is not to prop up lame ducks.

Which is why the board of Woolies, in the end, had no choice but to call in the administrator.

Comments

Page 1 of 3

  • Comment number 1.

    Its a sad day for the nation seeing woolworths going to the wall.So the end of the british empire will be sooner than we think robert, with the QE2 pulling up in Dubai aswell.

  • Comment number 2.

    It's when, out of all the many businesses that are tipping over the edge at the moment, there are one or two household names like Woolworth and MFI, that you realise that this is going to be a bad one.

    I don't believe we're as 'well-placed' to cope with this as some would like us to believe - i.e. those who believe in the power of positive thinking over fact.

    The fact being that this is a hangover we've been due a long time, and anyone who couldn't see it coming has shown they should be kept a long, long way from the reins.

  • Comment number 3.

    Sad, but bound to happen sooner or later. They were being squeezed by everyone including the pound shops, online shopping, WH Smiths and the rise of the MP3 player. I am surprised they lasted so long as they lost their core compentence ages ago.

  • Comment number 4.

    It is a sad day to see such a icon of the high street in dire straits.

    I can remember being a regular in my teens for the cheap paperbacks, and of course the pick n mix sweets.

    Lets hope something can be salvaged, not only for those who remember the brand fondly, but more importantly, for the many, many staff who will loose their employment if it is allowed to close.

    It just shows that all businesses, just like personal and even Govt. finance, has been run on nothing but mountains of debt. In 12 months time, we might perhaps see a high street missing some very old and well known names.

  • Comment number 5.

    I think this is the bit where our current situation starts to bite hard on the high street. Anyone who is, or was still wondering what all the hullabaloo about our economy is, should now start to feel fully appraised from now on.

    Woolies, sorry to see you go. MFI the same. Who's next?

  • Comment number 6.

    Woolies and MFI have been struggling for ages. They're in competitive sectors, and simply didn't compete very well. The consumer downturn and credit squeeze has finished them off. I wouldn't put either down as being a "shock" though. They'd have collapsed pretty soon in a boom, never mind current conditions.

  • Comment number 7.

    Very sad news for all of Woolies' staff especially at this time of year. The sad fact though is that Woolies and MFI were in terminal decline even before the credit crunch hit. Their business models are uncompetitive and they lost out. Eventually someone else will fill the gaps in the market that they leave but especially as far as Wollies is concerned, a part of high street history is gone.

  • Comment number 8.

    It is sad news this, I have spent quite a bit of money lately on Xmas pressies there -obviously not enough of us have. However it has been on the cards a longtime.

    Alan Sugar will be smarting a bit now, I wonder which apprentice advised this investment?

    Also, what is to stop Hilco buying the stores out of administraion without the debt burden. Like barclay's did with lehman's after all?

  • Comment number 9.

    Any chance that the cost of reprogramming all their tills and warehouse management to the new VAT rate tipped them over the edge?
    Timing is incanny

  • Comment number 10.

    #1 er.... can I point out that Woolworths is American, so I'm not sure why the comment about the British Empire etc

  • Comment number 11.

    Sad news. A little bit of Britain died today.

  • Comment number 12.

    Robert

    I'm confused by "Peter Mandelson, the business secretary, had contact with the company today - to ensure ........ it would keep its stores open if possible during the vital Christmas period."

    I can understand that this would be positive for its workforce, but would the economy not be better if consumer spending took place in stores which are NOT certain to close, and aid their survival.

  • Comment number 13.

    I think Woolworth was always going to be vulnerable as it does not offer a reason for a customer to go there especially (USP). Everything it sells can be bought cheaper elsewhere.

  • Comment number 14.

    It probably shouldnt be, but this is a big shock.

    Maybe thats the cost of change in a turbulent time.

    However, a much loved british icon and name on the high street is all but dead.

    I feel for the employees

    And also for the UK, we have lost something today that we probably wont see again

  • Comment number 15.

    This is a shame, firstly for the thousands who will loose their jobs just before the festive season, and secondly, I ve always remembered Woolworths on the high street, my aunty used to work in the fish counter at our local store years ago.

    A sad day

  • Comment number 16.

    By the time the admin censors get a post up who knows what else will have collapsed...

  • Comment number 17.

    Would be interested to know how many of those posting here about fond memories of Woollies have actually shopped there in the last 5 years? Anyone? No, thought not. That's why it's failed. As RP's update suggests, it's been losing market share for years. It isn't a recent failure. Bit like GM etc in the US. Not providing what people want. The credit crunch has simply brought about something inevitable.

  • Comment number 18.

    I remember eating a pick a mix sweet when I was about nine years old. It was the purple wraped hazelnut in caramel, like in Quality Street. As I was sampling it a store detective grabbed me by the arm and took me to an office and locked me in there. After awhile he came back with another man and both called me a thief and said if I were older I would have to go to court for shoplifting. I cried. And the episode still haunts me to this day! But hey, who's laughing now! :)

  • Comment number 19.

    Wow, always bail out the banks eh. Its a bit like when Rover went under, they could have used the opportunity to employ all those workers to design and build a cheap, state sponsored environmentally friendly vehicle. Now I expect we will see all these Woolies stores changed into Tesco Expresses, I'm sure some of our High Streets could take two Tesco Expresses. There are going to be a lot of glum people at Xmas this year.

  • Comment number 20.

    This is all part of the domino effect - since many of their the suppliers will face bankruptcy, which will lead to the further loss of jobs, house repossessions etc.

    So I'm sure that what with the VAT reduction everyone now feels minded to go out and spend a fortune on a new plasma set to cheer themselves up - yeah right!

    What will it take for the masses to wake up and realise that we are on the verge of a total collapse of our economic system?

    It just seems that everyone has been sanitised into believing as if everything will just tick along and recover before long - perhaps they have put something into the water supply?

    A recovery by July next year? What planet is Gordon Brown and his puppet Alistair Darling living on?



  • Comment number 21.

    A very sad day - and even more so given that it is my five-year-old daughter's favourite shop.

    That probably sounds shallow given the thousands of workers who will lose their jobs - but the retail chain is a national institution (albeit via the States) that she will probably not have the pleasure of growing up with.

    On the other hand my local branch in East London is always busy with customers. I wonder if there is a chance that this and other profitable stores can be saved?

  • Comment number 22.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 23.

    I am very sad about Woolies going under. However, if people wanted to keep it maybe they should have bought more stuff there.

    Their market got undercut by the tatty pound shops, and nobody with any real money shopped there. The growth of internet downlads probably didn't help either. I remember buying those Top Of The Pops records there in the early 70's - they could not afford to have the original artists so the hits were played by a covers band.

    I am also very sorry for the employees, who will have a miserable Xmas as a result. I am also wondering how long before WH Smiths and Boots go the same way. We will end up with high streets full of charity shops, pawn shops and bookies at this rate.

  • Comment number 24.

    This is the recession the Gov't and media have wanted, and I am sure it will get far worse before it gets better.

    Holding back pay rises to below Inflation has helped bring about this recession.

    And rather than create jobs, low pay will lead to high unemployment and greater poverty for all.

  • Comment number 25.

    > And government policy is not to prop up lame ducks.

    Oh, please Robert, you're teasing us. What about the banks?

  • Comment number 26.

    Woolworths MFI two rubbish shops bound to go under when pressure was applied.

  • Comment number 27.

    The death of a business is always a sad event.

    However, Woolworths nearly went before in the early Eighties and the standards of those who rescued the business then have long gone.

    The behaviour of the business in recent years has been a sign of a company which has seriously lost its way.

    My question is how on earth are they going to sell all that rubbish in their distribution centres and third party warehouses?

    Will they charge those who buy the stuff for their carrier bags?

  • Comment number 28.

    However Woolworth's joint venture with the BBC will not go into administration. It is owned by Woolworth's top company, which will not go into administration.

    Woolworths PLC which owns both the Stores and share in the joint venture has been suspended.

    What is this Top company ?

  • Comment number 29.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 30.

    "And government policy is not to prop up lame ducks."

    Northern Rock, anyone?

  • Comment number 31.

    The Housebuilders will be next to go bust.

    Nationalization of Housebuilders ?

    Is that part of Gordons plan........

  • Comment number 32.

    "And government policy is not to prop up lame ducks."

    Unless they're a bank.

  • Comment number 33.

    Hurrah, Woollies has been a waste of space on the high street for so long...it's tough on the employees, but any right minded consumer could see that it was one (over priced) step from pound land...it's electronic offerings were the worst kind of tat made in the factories of Shen Zen.
    Yes, it is going to be a very different high street.

  • Comment number 34.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 35.

    It is sad that Woolworths is going under. I remember them fondly. I have enormous sympathy for the staff, especially any who struggle to get a job quickly in the current climate.

    That said the growth of companies like Tescos came by outcompeting Woolies. Shoppers voted with their feet/ wallets.

    The Austrian school of economists argue that in a recession it is a positive to the overall economy for inefficient companies/ lame ducks like Woolies to close and create space for more efficient companies to expand.

  • Comment number 36.

    No mortgages means that when people apply for one, they also allow for a new kitchen, new bathroom, new carpets, new furniture, maybe a holiday and maybe a new car. MFI is a symptom of this. So look out for stores which supply the above items to become sick and fall in the new year. Also, entertainment type sales will also fall big time.

  • Comment number 37.

    "government policy is not to prop up lame ducks."

    Unless they are too big to quack.

  • Comment number 38.

    This is so sad. I'm kind of getting fed up of letting all great things British go - QE2, Concorde, now Woolworths!! Why can't we hold onto our assets anymore?

    I am 20 and always went into Woolworths every Saturday as a kid. I enjoyed shopping there with my parents. It was also nice to go there during special times of the year - seeing the xmas selection boxes and easter eggs piled high. It got you in the mood.

    But I agree with comments here, that it has been a lame duck for a very long time and that it has been unable to adapt itself. This was long overdue. This should have happened a while ago. (As with MFI). I remember hearing when WH Smiths was in trouble. But a smart move was that by having Post Offices in their shops, this then drew customers into their stores. Why couldn't Woolworths have struck a similar deal and revived itself?

    Recently I have been going to Woolworths regularly again with my father to check out their dvds, but you can get them cheaper at major supermarkets now. They don't sell anything special or specific. It's rather like a big jumble sale. Maybe thats why so many people loved it? But now, more and more people turn to Tesco, pound shops or the internet to get their goods.

    The most recent things I bought from Woolworths were a pad of A4 paper and some chocolate for University. That's it. And the store was rather depressingly empty. Why? Well there's nothing really unique to buy from Woolworths anymore. It doesn't know what it wants to be. And the goods are not exactly pricey. How can you make profits from Pic n' mix and expect to survive?

    Although many British people, including myself will be reluctant to let go of it - let's move on and support our other institutions - or even devise our own 'Woolworths' for the 21st Century. However I feel sorry for the staff that may lose their jobs before Christmas. Where's the empire spirit? Surely they could reinvent themselves and recover over Christmas?

  • Comment number 39.

    Dear Robert:
    Your BBC journalism is always a delight - so congratulations. However, despite your pedigree, you don't seem to have grasped how banking works in the western world. You repeatedly tell viewers and listeners that banks only lend out money they either already have or can borrow from elsewhere. Please bone up on Fractional Reserve Banking - which is what we have in the West - and then you will see that what currently discourages the banks from lending is not lack of funds but a) their lack of faith in the value of real estate assets and in the financial viability of SMEs; b) the dubious quality of some of their existing balance sheet assets; and c) liquidity problems brought about by the fact that nobody trusts anyone else, which means that short-term inter-bank lending has dried up. The collapse of City Bank exemplifies the problem and justifies the banks' caution. To whom can you lend with confidence if even organizations like City Bank and HBOS are in danger of going under?
    For banks to trust each other, they will have to clean up their balance sheets. That's an essential first step towards replenishing the supply of credit. But poorly-regulated Fractional Reserve Banking bears a heavy responsibility for the mess in the first place because it allows banks and credit agencies to create money. How about some thoughts from you on this issue?

  • Comment number 40.

    The demise is a sad indictment of poor management nothing less nothing more.

    You can't expect to survive living off past glories alone.

    Business is a bit like Madonna, although maybe less complex, in that you need to constantly re-invvent yourself to get things right!

  • Comment number 41.

    Won't be the last 'name' to go!

  • Comment number 42.

    Very sad and a very real example to many why the credit crunch was always going to impact us all.

    I remember seeing on the news not so long ago various quotes from "the man on the street" saying that the credit crunch was all about Fat Cats and Bankers and had no impact on them. Guess they were wrong.

  • Comment number 43.

    "However Woolworth's joint venture with the BBC will not go into administration. It is owned by Woolworth's top company, which will not go into administration."

    What !? Why on earth is the BBC in a 'joint venture' with a retailer anyway ? Ridiculous !

  • Comment number 44.

    10. At 5:44pm on 26 Nov 2008, ghanimah wrote:
    #1 er.... can I point out that Woolworths is American, so I'm not sure why the comment about the British Empire etc
    = = = = = = = = =

    Woolworths Group PLC has been a wholly BRITISH company since 1982.

    EDUCATION!! Education!! edukayshun!!

  • Comment number 45.

    Very sorry to see this great institution close.
    There are those I would gladly see disappear eg Alliance & Leicester who seem to have made the old fashioned word usury fashionable again after failing to reduce their standard variable mortgage rate at all despite the Government pumping millions into the banking sector to keep it afloat!
    Long Live Woolies!

  • Comment number 46.

    One way to boost demand would be to give all Public Sector workers a pay rise that macthes Inflation , say eleven percent.

    That would get some tills ringing again !

  • Comment number 47.

    Sadly, a sign of the times. I can remember when Woolworths was the main non-food shop in the little market town I was brought up in.

    If you wanted anything you couldn't get anywhere else, it was Woolworths, and you usually got a quarter of Pick'n'Mix on the way out.

    I can remember getting most of my DIY stuff and a few singles (remember them) there in the 70's

    It has lost its way in recent years. I have popped in a couple of times, but found it confusing and with long queues.

    I think it was Sheila Hancock on the Andrew Marr show a week or so ago who reminisced about how great an institution it was, but I think she said it has now become "tatty". Sadly, I agree.

    I think it didn't know what it was any more. It has been coming for a while, but the crunch has pushed it over the edge.

    A sad day

  • Comment number 48.

    Actually, if the Public Sector unions went on strike now, they could write their own cheques.

  • Comment number 49.

    Yes it's a sad day - not that Woolworth's is going into administration but because again the government considers throwing taxpayers money at this dinosaur.

    Businesses evolve or die. Simple. Good examples; Wang died, Apple evolved.

  • Comment number 50.

    Very grim for the employees - let us hope that some sort of rescue can happen - however they were just too weak over the last few years; poor website, goods could be found cheaper elsewhere and they didnt really know what they wanted to retail. Odd that so many are 'upset' by the demise as if they had shopped there it would still be ok.

  • Comment number 51.

    Of course, as the High Street collapses any company that relies on Rent from commercial retail will suffer.

    Eventually all companies based purely in the UK will find their profits reduced.

    And many more may go to the wall.

    Our economy has long been designed to run with a background rate of Inflation.

    Restricting pay rises puts a brake on consumer spending and of course undermines businesses.

  • Comment number 52.

    i bet gordon brown will be even happier now, chortling away at peoples misfortune

  • Comment number 53.

    -And government policy is not to prop up lame ducks.-


    Except of course the lame duck banks. Our government would sell off their collective mothers (and ours for that matter), to keep those particular hobbled mallards from falling.

  • Comment number 54.

    For a decade Woolworths has been slowly declining whilst a new retailer, Wilkinsons, with almost the same business model, have thrived and grown.

    This surely proves that the problem at Woolworths comes down to plain bad management. They just don't know how to run their business.

  • Comment number 55.

    Spare a thought for poor Sir Alan Sugar - he only went and blew £4M of his cash a couple of months ago investing in this entity. Shame eh? Do you think he should fire himself?

    Actually, I am kicking myself, I missed a great opportunity since I could have told him he was wasting his money - I could have charged him a mere £500k for my advice and saved him £3.5M - well, hey as the great man says you gotta look for the opportunity.

  • Comment number 56.

    This is a disaster, made all the worse by Robert Peston and his continual nosing around in the dirt trying to unearth even worse to come and then gleefully speculating
    in advance and congratulating himself on being first again when it comes to pass.
    It's not clever, and is undermining those of us at the coal face trying to run small businesses and survive. Have you ANY idea what it's like trying to operate in this fog of irresponsible, hysterical, reporting. We're not stupid, we know it's tough and this type of reporting does only one thing and that is undermine, individual,business national and global confidence. To pretend it doesn't is naive to the point of stupidity. RP should try getting a proper job some day out from under his BBC comfort blanket and experience the cold chill that he and his kind are creating for the rest of us.

  • Comment number 57.

    And there's more ......

    http://news.bbc.co.uk/1/hi/england/west_midlands/7750958.stm

    BMI confirm 5 summer route suspensions .... but this will not be NEW news to many of their customers.

    They cut their route from E. Mids to Warsaw several weeks ago... just keeping the flights immediately around the Christmas week operational.

    Other destinations, I believe, have had the same cuts.

    If you're flying anywhere after Christmas, and they haven't told you it's cancelled..... LOOK OUT!

  • Comment number 58.

    No. 20

    While I agree with the probability of a total collapse is very high - do not expect normal people who have little interest in anything apart from big brother and I'm a celebrity get me out of here to be able to grasp the economic meltdown where facing.

    I reckon by February, when food shortages kick in, people will begin to wake up to the realties of the monster that's been created. This is when the social unrest kicks in....it's all very worrying.

    I reckon the government will be handing out food vouchers next year, not 2.5% cuts in VAT!


  • Comment number 59.

    @10

    They all American workers aswell are they?
    am glad i dont know you

  • Comment number 60.

    "And government policy is not to prop up lame ducks."

    Did you really type that with a straight face?!

  • Comment number 61.

    Woolworths in Wrexham has been replaced by the likes of Wilkinsons - similar product range, possibly cheaper prices - but fronting a car park, not hemmed into a pedestrian area. Easier to load larger items (kitchen equipment, storage tubs, garden stuff). I don't think Poundland is an equivalent. It is also easier to buy similar stuff in with the weekly groceries.

    So once the Saturday singles chart market disappeared, Woolies has been in a poor position to compete. About a quarter of our local Woolworths used to be music and video.

    Easy to see why shops like this are failing. The revolution in UK shopping habits doesn't seem to be understood on the high street and definitely isn't understood by town planners!

  • Comment number 62.

    I shed no tears for Woolworths. I dealt with them years ago when they were strong and they were the most incompetent yet bullying retail customer ever.

    I recall agreeing with a coleague over 10 years ago that they had no future and no point in the face of the strengthening Grocers and so it came to pass.

    Another badly run business goes to the wall. Big deal.

  • Comment number 63.

    Huh. Remember when everybody was having a good laugh about those fat-cat bank bosses having to resign in disgrace and how all the bank staff would lose their bonuses and what a jolly good laugh that all was?

    Too good for them. Greedy bankers. Imagine conjuring up all that money out of fresh air so that I could lie on my self-cert mortgage and buy an insanely priced house.

    How good y'all felt because somebody who 'deserved' it was losing their job. Even Brown (particularly Brown) was getting in on the act. Getting into a swoon about how irresponsible those bankers were.

    Woolworth and MFI are phase two of the economic meltdown. The first of many that will fold as the consumer tightens their belts. Maybe that VAT cut came a week too late eh? Yeah, right.

    Recession over by mid 2009?

    This government are completely off their heads. It hasn't even started yet.


  • Comment number 64.

    So HBOS, Northern Rock and RBS weren't lame ducks then? As usual it's fine to save our precious banking "industry" from itself, but when it comes down the the jobs of ordinary shop workers, no effort is worth making. Perhaps if the shop workers union had a yacht in the Mediterranean, Mandy would have tried harder?

  • Comment number 65.

    #34 you are actually blaming robert for the recession?
    You sound as deluded as GB

  • Comment number 66.

    Breaking news...............

    Alistair Darling announces new green oxegen tax !

  • Comment number 67.

    Oxygen, obviously!

  • Comment number 68.

    19 oktorockto
    there once was a Tesco Express that closed down not longer after opening in Fulham Road, its now a Bathstore. Probably because there were already 2 others further up and down the road. What a gay day that would be when Tescos finally follows Woollies into oblivion!

    17 JayPee28bpr
    Another eminently sensible post by you. I have been in a Woollies a few times in the last five years but I'm not sure I found anything I wanted to buy, except for when I used it as a one-stop shop to kit my daughter out for 1st year life at Uni.

    to 15 and others - I know this is pedantic but it's lose, not "loose". I can't "loose" my job, but I may well soon lose it, along with my rag with such p-poor spelling.

  • Comment number 69.

    It's all very well people reminiscing about pick 'n' mix etc but where have these people actually been doing their shopping?.. Yes that's right, parking for free in some anaemic retail park near where you live.

    Tesco are the ones I'd like to see go into administration....we might get the high street back then.

  • Comment number 70.

    I think Woolies started going downhill when they changed their pick 'n mix supplier a few years ago,

  • Comment number 71.

    It's sad for all of those people now out of work, but not entirely unexpected.
    Woolies has, for years, been a "last resort" kind of shop & only, if all of the focused shops failed me, would I venture into their emporium.
    The atmosphere was always more akin to that of a bring n buy sale than a proper shop; with sweets next to chart singles next to babygro's next to lamp shades etc.
    My overwhelming memory of Woolworths, however, is going in on the day Killer Instinct was released for Nintendo 64 & finding a copy complete with bonus CD when every other game store in Stockport had failed me. I'll miss you Woolies, RIP

  • Comment number 72.

    I don't agree with all the talk that Woolies and MFI 'have to go' as if somehow these companies collapsing was inevitable....... there have been plenty of companies turned around...Topshop was half way to a basket case once and now Phillip Green (Sir) has it bouncing past Next and the rest.

    There have also been plenty of companies "collapsing" that nobody thought were 'basket cases'.... AIG, Lehman, Honda (even)..Nissan... (both cutting shifts and production in the UK and across the world)

    I think I am struggling to retain the thread here!!

    But what (I think)I am saying is nobody is suggesting Honda are a 'basket case' ...and suddenly revealing Woolies are and everyone knows it..AFTER they collapse doesn't really add much to anything.

    I think half the problem is that orderly liquidations of retail companies have previously rested on property valuations and the attraction of buildings to rivals,(often) supporting the realisation of cash process...but now the commercial property market is so bombed out, and the rest of the retail market so (effectively) over provided with shops it means that method of support isn't there.....

    There's a similar issue developing in the newspaper industry where some groups are valued at less than their buildings would have brought IF the property market was like it was in 2006 ...Oh!...and also IF anyone had capital to buy out the companies in the first place--That's two big 'ifs' !!


    The bottom line is that this is just an enormous human blow for all the people in woolies... working away with Christmas approaching and now this whole thing is breaking around them...and for once I include the management..who seem to have been battling hard to save the company for ages.


  • Comment number 73.

    Anyone with half a management brain could see that Woolworths was a basket case long before the recent problems, it had lost its direction and the directors had no answer, the present crisis has just hastened the demise.

    With MFI, this is just a taste of what is to come, many companies are way overleveraged and it is just a matter of time before we see wholesale bankruptcies. Gordon's stimulation package it far too little too late.......but he seems to think all is well, he was smirking all the way through PM questions.

  • Comment number 74.

    It's all well and good saying Woolies is rubbish but some of us have no choice. I live in a small town whose high street mostly comprises of charity shops. Our Tesco moved a mile out of town a few years ago meaning if you don't have a car (I can't afford one) Woolies is the only place to get anything remotely resembling a useful household item like a plug extension or a lightbulb. They also sell DVDs and computer games which you can't get anywhere else within walking distance. A lot of people where I live will find it hard to get by when one of the few useful shops left here closes. It will mean you can hardly buy anything without having to get a bus into the nearest big city or to Tesco.

  • Comment number 75.

    Why does the government prop up banks and building societies and not high street retailers? The answer is pretty simple really.

    Shops are where people spend money.

    Banks are where people keep their money.

    If the banks go, then people have no money to spend in the shops.

    When major banks go down, they have a tendency to take good chunks of the economy with them.

  • Comment number 76.

    If we can spend billions to allow investment bankers to carry on getting their million pound bonuses, then why can't we bail out a company who employ 30,000 people?

    What sort of 'socialist government' allows working class people to go to the wall while saving investment bankers?

    For shame Brown and Mandelson.

  • Comment number 77.

    These are bad times indeed. When the government is ready to stave off home repossessions it can't bail out a business like Woolworths and save some part of 25.000 jobs?

    Same with MFI who has gone under because of failure in the housing market / downturn (thanks to the government's inanity in the first place).

    I mean, if Woolworths is a lame duck business, what about those 25,000 losing their jobs, some of whom will no longer be able to afford the mortgage payments? Are they lame ducks and will the government support them?

    Bah! Humbug! Are there no prisons, no workhouses?

  • Comment number 78.

    So the great Woolworth's british institution fondly remembered from my child as the place to buy pic'n'mix sweets and 7" singles -- dies a timely and not too soon death.

    I feel for the 25,000 employees coming up to xmas -- but this recessionary meltdown is quite rapidly surfacing the fragility of the UK economy.

  • Comment number 79.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 80.

    A pubic (yes correct spelling) service worker ( please don´t all laugh) You and all the thousand of your fellow workers (another laugh) re the cause of much of our debt pain (you support Gordan . Yes ) area main causes of our over spending.

  • Comment number 81.

    "Gordon's stimulation package it far too little too late.......but he seems to think all is well, he was smirking all the way through PM questions."

    Yes, that was positively disgusting. Has the bloke no morality at all? Is he just extracting the mike from us all, knowing he's done-for anyway?

    He ought to be made to do community service for the rest of his life to pay back as much as he can for what he's cost us.

    Sickened by his smugness.

  • Comment number 82.

    hi all

    can i just add that its not only woolworths staff loosing their jobs. Im one of the store managers for the store21 concessions just opened in woolworths clydebank our company opened 16 new shops in woolworths in the last 8 weeks, Due to woolworths going we might loose our jobs too. Woolworths might be a stuggling retailer but ive never enjoyed my work so much scince i started in woolies

  • Comment number 83.

    guess i'd better spend me woolies vouchers pretty quick!

  • Comment number 84.

    Just heard a rumour that the staff at Woolies might not be paid for November. So what on earth is this ridiculous government going on about when urging the company to keep going over Christmas.

    Agree with comments about lame ducks, the biggest lame duck in the UK is not the banks but the government.

  • Comment number 85.

    It will not be until the high street is a (white)wash with empty glass fronts selling bill-stickers and the Banks have left the empty shells of a bulging by-gone age with interest that people will begin to realise that the journey to the hyper-market is not as pleasant as hustle and bustle of local commerce.

    A wasteland between home and shopping utopia where the shelves spew out offers to keep the interest of people before they battle the ground toward home again.

    No such thing as community in Britain in this century and not enough charity shops to vill the void

  • Comment number 86.

    You can bet John Lewis won't go bust. MP's still have vast expenses and they could probably kick-start the economy on their own.

  • Comment number 87.

    After reading this blog, I decided to research Wilkinsons. I liked what I saw, wholely British, privately owned, founder saved a quid a week for 6 years to get the seed money.

    I really hope they can get some stores at fire sale prices. for retail.

    i am becoming more concerned about the effect this 'economic dip' is going to have.

    In our marketplace are some very old traditional Brit companies with large market share.

    There are also many EU companies with small market share.

    Without capitalisation, and I am thinking only of construction firms but extrapolate across the spectrum, I can 'remote view' a situation where our market gets dominated by more EU, US and Far Eastern companies.

    This is fine under my idea of strict capitalism, but (imho) I think it is a shame that this change to the balance of power to our top 500 companies may be due to exotic derivatives traded in the bars in canary wharf over the past few years.

    And the bars arent that good either :)

  • Comment number 88.

    @ Post 62...
    I found Woolworth's buyers to be quite arrogant too. We offered them our products, knowing that we were competitive on price and had good quality, and they refused to even consider looking at our proposal. They had an air of "we're Woolworths, we don't need you". Whilst it's a rotten day for the employees, the finger of blame should be pointed straight at their so-called management, for allowing these hard working folks lives to be wrecked by their attitude. Hopefully the staff can be saved or they'll be snapped up elsewhere, and the management will suffer for their attitude.

    Oh yes- pick 'n' mix, 7" singles, etc- remember them all with a touch of nostalgia, but times change, shame their management didn't.

    Good luck to all Woolworth's staff.

  • Comment number 89.

    And government policy is not to prop up lame ducks.

    er...........High street banks have been spoon-fed billions...........or does the government just feed fatcats?

  • Comment number 90.

    When I was a kid, Woolworths was a child's paradise. It had everything, from sweets and school stationery to books and CDs. Now, my local branch, is full of rubbish, and overpriced rubbish at that. The majority of the staff are bad-tempered and unhelpful. So no, I won't be sorry to see it go, however, my local High Street won't seem the same without it.

  • Comment number 91.

    It's one thing loosing Woollies and MFI, but loosing the regulars on this blog? Where's GC?

  • Comment number 92.

    No.82 - Store21
    I am genuinely sorry about the situation, I understand that the major shareholders were trying to get this delayed or the best bits sold off but management capitulated - probably under banking pressure.

    I was also disgusted to read above that staff may not be paid for november - unforgivable.

    I unerstand that there is a 100mill pensions hole, but the fund will probably be hawked off and will be practically worthless anyway, so people who gave years of service will also be screwed. Not nice.

    There are other stores/franchises and I hope you do well in the future.

  • Comment number 93.

    #88

    Yes, they were known through for it but at one time they were the dominant force in certain sectors so to some extent you had to put up with it.
    Not all of us did though and I happily put the phone down on one buyer for his abusive attitude. I shan't name him of course but he was nothing without his buying power.

    They were also known for being incapable of delivering on a promotional activity. The supplier would fund it (of course) then they'd forget to tell the stores to put the product out, leave the stock in distribution centres, etc then try and come back on you later for more money to clear what they hadn't sold.

    The credit crunch is nothing to do with their demise, they've been on oxygen for a decade and should have been put out of their misery back then.

  • Comment number 94.

    For perspective only...

    'Laid-off workers from a toy factory in southern China clashed with police Tuesday night in one of a string of labor disputes that have been reported across the nation in the face of rising unemployment'

    'thousands of factories have been shut down as orders for exports dry up'

    Taken from the wall street journal...

    http://online.wsj.com/article/SB122772472846760239.html

  • Comment number 95.

    When I read the news online I was initially very sad, however where have we all been shopping lately? Tesco and alike. So much for the competition rules? Or is this really market forces?

    Wollies demise is a bit of everything from poor adminstration to the credit crunch. Almost saved but those greedy creditors, UK high street banks, and US banks put pay to Wollies. This may seem harsh but fair, the end has been so close for so long.

    Next the HIGH ST? The internet is the way forward..... Pick n Mix consigned to history as we know it......

    Next this government needs to go..!? They can't blame all the countries problems on the global economy and it woes, before long we could be holding our begging bowls out to the IMF. UK plc should be in adminstration and as such we need a new adminstration. Not sure who can sort this messy out any suggestion. I predict more gloom to come in the weeks and months ahead!

  • Comment number 96.

    P.S. sorry #68....couldn't resist it

  • Comment number 97.

    All of you feeling nostalgic about Woolies check out the history section of the companies website at http://museum.woolworths.co.uk/

    Celebrating 99 years at the heart of British shopping. Is it 'worth it' (sorry) to try and get it to the ton and beyond.

    New fb group 'save woolies' with 5,000 plus member already.

  • Comment number 98.

    And so Woolies joins the ghosts of Christmas past. This is a sad day indeed, for I remember a time when virtually anything you could possibly want could be found in a Woolworth's store. Whether it was browsing through the well-stocked aisles of their 1980s 'record bar' on a Saturday afternoon or the Winfield christmas lights that got taken out and strung on the Winfield Xmas tree every year, Woolies was for many years a part of British family life.

    It survived the last recession - a stalwart of High Streets otherwise shuttered and dark in the bleakest period of 1991-2, but ultimately I fear it was its dependence on those town centre locations it has occupied since time immemorial that was its downfall, because people just don't go 'into town' anymore, and it's a rare out-of town centre that has a Woolies.

    I don't even think that their 'jack of all trades' model of retailing is necessarily the issue - after all Wilkinson's, which is in many ways what Woolies used to be minus the Lego and cassettes, has done very well out of it. Some years back Wilko took over a former Sainsbury's midi-market in my home town and in the same week Woolworths closed their first floor sales area - something I considered an odd decision even then, since it instantly halved the range of goods on offer.

    And in that same town centre there will now be another gaping hole alongside those left by Littlewoods, Index, McDonalds (left the centre for a new drive-thru on the outskirts), M&S (headed to an out-of town centre), Our Price and far too many others.

    Woolies and MFI have survived many ups and downs over the years. Their deaths suggest to me that there are very bad times ahead, for all of us, and all bets are off as to who's next.

  • Comment number 99.

    Inevitable Im afraid - I used to manage a Woolworths store about 10 years ago and whilst I agree with most of the comments here about competitors and location as reasons for Woolies demise, I also believe that Woolies lost its magic.

    Most of Woolworths' profits came in the last quarter i.e. Christmas. You would walk into a Woolworths store and you would just feel Christmas oozing from every aisle -the decorations, window banners, wall decorations, displays - Woolworths would spend fortunes on theatre within the stores at Christmas but it made it feel magic! And so people loved being in the stores, especially kids and that drove footfall. Remember those lavish adverts, my favourite was Norman Wisdom and the nutcracker - genious. Woolworths was Christmas. Then we got some strange alien but that was okay and now a stupid sheepdog and sheep. Unfortunately the store decorations have faded the same way and now Woolworths is just another High Street retailer with nothing special going on.

    I must agree most with those who blame this on poor management, not just recently but over the last 10 years.

    I had the privilege of working with some fantastic people in what was a family sort of atmosphere - I wish them well!

  • Comment number 100.

    I worked for Woolworths for 10 years, until 2002, I loved the job and was very proud of the Woolworths brand up until the last year or so.

    Woolworths helped create the Kingfisher Group and was on the verge of merging with ASDA back then. Aggressive marketing, competitive pricing and innovative promotions. Woolworths lead the way introducing 3 for 2 and BOGOF promotions, as well as the giant Big W out of town warehouses.

    Then the company went rapidly downhill, losing out on ASDA to Wallmart, the branches that were owned by the company were sold off and rented back as it seperated with Kingfisher and went on its own with Superdrug.

    Not long afterwards the direction and vision of the company virtually disappeared. Before leaving they were trying to re-establish the stores as a one stop shop for home entertainment, special events and sweets.

    With the rise of Tescos, under cutting and selling at a loss (even though supplied by EUK - the distribution arm of Woolworths) they were hammered. The branches fell into a shabby state with the constant re-arranging of shelves, banners and promotional products on a monthly basis.

    Plenty of the posts highlighting the poor performance of the company and bad management in recent years are correct.

    I would point out a couple of things though.

    Firstly, in many small towns Woolies is the ONLY shop offering such a wide variety of things from CD's to School wear, picture hooks to light bulbs, and those small communties need these branches.

    Secondly, the 25,000+ employees work very hard and long hours (60+ a week when I worked there) and I feel for them at the moment facing possible redundancy at Christmas of all times - their busiest period.

    I only hope that the smaller, vital branches are saved and at least some of the colleagues keep their jobs.

 

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