Suppliers pledge to back Courts rescue

Courts' key suppliers have rallied around the stricken furniture retailer and are throwing their weight behind the new management team's strategy to return the UK chain to profit.

The retailer requested a grace period from suppliers last month, because it was locked in negotiations to secure a£20 million overdraft extension.

The facility was approved last week.

Buying director Mireille Baumgart admitted asking suppliers to accept a 15- to 20-day delay on payments, but said it was a 'very short-term measure and only for July'.

Silentnight Group chief executive Nino Allenza leapt to Courts' defence.

'Having met the senior management team to discuss business plans, we were impressed by their clear sense of direction. Recent sales growth has been encouraging,' he said. Helvetia Furniture, Simmons Bedding Group and Buoyant Upholstery all voiced similar sentiments.

Courts UK turnaround manager Alan Fort is focused on optimising the 97-store estate. Underperforming older shops will be shut.

A new format has been developed and tested in three shops. The stores have a smaller footprint of 25,000 sq ft (2,320 sq m), plus a mezzanine, compared with an average of 30,000 to 35,000 sq ft (2,785 to 3,250 sq m). The more integrated lifestyle layout encourages customers to shop across the assortment and employs good, better, best pricing.

Baumgart said the store-type had boosted margins and average transaction values, and is now considered the benchmark. To support the approach, a more upmarket marketing stance is being adopted, and 16 new ranges will be in stores by the autumn.

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