The upmarket fashion chain LK Bennett has collapsed into administration, putting 500 jobs at risk, after its owners failed to find a new financial backer to keep it afloat.
The UK company, which famously counts the prime minister and Duchess of Cambridge among its customers, has appointed accountancy firm EY to manage the administration of its 39 shops.
EY immediately closed down five stores – Brent Cross and Westbourne Grove in London, plus Sheffield, Bristol and Liverpool – resulting in 55 redundancies. It blamed rising business rates and rents for the company’s problems. It was also owed nearly £418,000 by department store group House of Fraser, which went into administration last year in a process also managed by EY.
EY said it was hopeful of finding a buyer for the business and would work to ensure trading would continue and orders fulfilled.
LK Bennett has struggled financially despite its popularity with high-profile women including UK Prime Minister Theresa May, who for a photoshoot for the US edition of Vogue wore a blue dress from the retailer.
LK Bennett’s customer service telephone line was closed as of Thursday afternoon last week, while its website carried a holding message reading: “Thank you for visiting LK Bennett, we’re experiencing some issues but should be up and running again soon.”
Its founder, Linda Bennett, who opened her first stores in 1990, had emailed staff a week earlier to say that she had “fought as hard as I can … to turn the business into the success that I know it deserves to be. These are difficult and unstable times, and we are doing everything we can to identify the best way forward.”
RPA Perspective Dan Hurd, a joint administrator at EY, said: “A sale process for the business has commenced. Trading will continue as normal, although web sales will be temporarily suspended to allow the administrators to work with the company’s trading partners.”
It was reported last month that Bennett was looking for new backers, but last Friday it emerged that the company had filed notice of intention to appoint an administrator.
LK Bennett’s international operations are not part of the administration.
Colliers International has looked at LK Bennett’s business rates bills for 37 shops and has estimated these are now 26% higher than before the 2017 Revaluation. The total bill for UK shops (not including concessions) will this year be around £3.4 million compared to £2.7 million in 2016/7.
Some particular shops whose business rates bills are considerably higher are as below.
| Location | Business Rates Bill 2016/7 | Business Rates Bill
2019/20 |
Percentage Increase |
| Jubilee Place, Bank Street E14 | £54,800 | £93,800 | +72% |
| Great Eastern Street, EC2 | £43,000 | £70,400 | +64% |
| St Pancras International Station, NW1 | £61,000 | £186,300 | +205% |
| Westfield Shopping Centre, W12 | £74,500 | £149,500 | +101% |
| Brook Street, W1 | £139,590 | £251,500 | +80% |
