By Harry Mottram: Earlier this month the stationery chain Paperchase appeared to be on the brink of collapse after Sky News revealed the firm with a store in Milsom Street had sort the services of insolvency practitioners Begbies Traynor. Today (January 31st, 2023) Sky News have broken the story that Paperchase have now entered administration.
Begbies Traynor were reported to said on Sky News: “Unfortunately, despite a comprehensive sales process, no viable offers were received for the company, or its business and assets, on a going concern basis. The joint administrators will continue to monitor trading in the stores and further updates will be provided in due course.”
For the next two weeks the business will continue to trade as normal but clearly for suppliers and the 1,000 staff at the 100 branches this is a worrying time. It is also a concern for the centre of Bath where stores such as Debenhams have closed in recent times.
Although no buyers have come forward to take on the high street stores Reuters have reported that Tesco have bought the brand name and intellectual property. That will mean the supermarket using the name and stock to rebrand their own inhouse stationery ranges as confirmed by Jan Marchant of the supermarket. She said: “Paperchase is a well-loved brand by so many, and we’re proud to bring it to Tesco stores across the UK. We have been building out plans to bring more brands and inspiration to the ranges we currently offer, and this will help us to take those plans further.”
The chain was taken over in August by Steve Curtis, an experienced retail investor who has been involved with Tie Rack and Jigsaw. It is now being auctioned by PricewaterhouseCoopers (PwC), the accountancy firm.
He said the firm had a long history of money problems. Founded by two art students in 1968 the firm grew to employ 1,500 staff and more than 100 stores. But as it grew so did the problems as shopping habits changed. W H Smith came to its rescue in 1985 and in 1996 it became Paperchase Products after a management buyout before in 2004 Borders took control. Three years late they sold a stake to Risk Capital for £10 m. There were more problems in 2009 when Borders collapsed but HMV and Waterstones were amongst stores to offer Paperchase concessions in their shops in 2010 following a management buyout with Primary Capital Partners taking over the business.
Since then Primera Capital through a legal entity, Aspen Phoenix Newco Limited, acquired the stationery chain but they clearly have found it hard to turn the business around. There is now a doubt over the future of the remaining 100 or so stores and its 1,300 staff. The situation is very different from when Primera Capital took on the enterprise as there were plans on growing the business by opening new stores.