The administrator to Threshers owner First Quench has started shutting stores. If the retailer had listened to customers, would it have collapsed in the first place?
For the past few Christmases, shoppers have stocked up on festive booze at off-licence chain Threshers. Why? Because the retailer created a feeding frenzy by issuing 40% off vouchers in a viral email campaign.
This year shoppers will probably rush once again to Threshers to get some bargain booze, but for a very different reason. Starting today, some Threshers stores will go into a liquidation Sale as they are being wound down by parent First Quench’s administrator KPMG. Depending on stock levels, 247 of the chain’s loss-making shops will trade until November 25 and another 126 will shut on December 2.
While administrator KPMG said it is trading the remainder of the stores until a buyer is found, the fact that 373 of First Quench’s 1,100 shops have closed because they were loss-making says a lot about the business.
All retailers have some loss-making stores but for a chain to have at least nearly 400 must have meant it was haemorrhaging money. The crying shame is that many of these stores were once very profitable but supply problems meant that towards the end, they failed to offer what customers wanted.
Before Oddbins was bought and Simon Baile took over, the retailer had a similar problem to Threshers – it had stopped offering what customers wanted.
Yet while Oddbins clearly competes with the supermarkets, over the past 15 months, Baile has completely overhauled the product range to deliver what customers want. And he is seeing the fruits of his labours – new product categories are showing double digit growth, and for example, while champagne sales are down 20% across the sector, at Oddbins, they are down just 2.5%.
Baile’s success shows that with the right products and management, Threshers could be a profitable chain.
But as the days go on, the number of stores that will remain trading seem to get lower. At first it seemed that around half the stores would be axed and interested buyers thought they could save around 600 stores. The mood now tells that only around 3-500 will be saved.
While it is fantastic news if a buyer can salvage the brand and turn it around, the glut of shops to close will leave a massive hole on the high street.
You have to wonder – if First Quench had listened to customers, would it have collapsed in the first place? The depth of the retailer’s problems is not yet known, but listening to customers is key.