Topshop parent company Arcadia has launched a series of measures to cut down on costs amid the coronavirus crisis, including deferring payment into its pension scheme.
The fashion giant, which owns retailers including Topshop and Dorothy Perkins, is due to pay more than £2m into its pensions scheme monthly over three years under the terms of its company voluntary arrangement (CVA).
But the fashion group has postponed payments due to the outbreak of coronavirus and the impact on its cost base.
It is understood that Lady Green will continue to make her contributions to the pension scheme as well as providing an additional £100m to bridge the shortfall from Arcadia’s contribution.
Even with this increased amount the total contributions to Arcadia’s pension scheme have halved – an arrangement that it is understood the Pensions Regulator has agreed to.
In a further bid to cut costs Arcadia has written to suppliers to inform them that it will be cancelling orders and extending its payment terms to 90 days, a move first reported by Drapers.
Fashion firms including Primark and New Look have taken similar measures as mandated UK store closures severely limit retailers’ ability to sell products at a fast enough rate to accommodate new deliveries.
H&M has agreed to pay its suppliers for cancelled orders where products have already been manufactured – and is understood to be one of the few fashion retailers to do so at this stage.
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