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Customers fear for cash deposits as Collectables fails
8:00pm Thursday 26th September 2013 in News
CUSTOMERS face an anxious wait to hear if they can reclaim cash deposits after a North-East furniture and gifts chain collapsed into administration, placing 200 jobs at risk.
Collectables, which grew from a barrow in the MetroCentre, Gateshead selling Geordie-themed novelties into an £18m enterprise, called in the administrators amid a mounting cash crisis.
It comes as an alarming new report said a quarter of retailers in the North-East are at a higher than normal risk of insolvency in the next year.
Steve Ross, chair of insolvency body R3 warned that traditional retailers were at risk as they struggle to react to the economic recovery.
Angry Collectables staff told The Northern Echo they had feared for some weeks that the chain was in trouble but were shocked by the sudden closure of all 11 shops as well as its flagship Stockton store, which includes the Beds Express, Big Cane and Mandale Furniture showrooms.
Administrator KPMG last night confirmed it had made 25 staff at Collectables' Tyneside headquarters redundant and retained the services of 12 people as it attempted to find a buyer for the 27-year-old family-run firm.
In total, 200 jobs are under threat and staff are owed thousands of pounds in wages which the administrators admitted are unlikely to be paid.
KPMG has called in specialists who are helping staff to make claims for recompense from the governments redundancy payments office.
A Collectables shopworker who asked to remain anonymous said that she had only recently started working for the retailer after spending months looking for a job.
"I am absolutely devastated," she said. "I was told by my boss that I wouldnt be needed any longer. Its not easy to find work around here so I was really happy when I got this job. I dont know what Im going to do now," she added.
A KPMG spokeswoman said it was too early to give advice to customers, but she admitted that: "a number of people have paid deposits for significant purchases, largely furniture, which are unlikely to be supplied."
She said the administrators would be contacting affected customers with more information.
Collectables was the brainchild of Philip Lewis, 73, a lifelong retail magnate who lost a fortune in the 1980s when his chain of North-East off licences went out of business following the miners strike.
He rented a barrow in the MetroCentre to sell toys and novelty items, such as Geordie passports and marriage certificates.
He opened his first Collectables outlet in the shopping centres Antiques Village, and gained popularity for selling glass and china items such as Lilliput Lane cottages, Lladro figurines and Royal Doulton vases.
Shops were opened in Newcastle, Dalton Park, near Seaham, County Durham and Harrogate.
In response to customer demand Mr Lewis opened a branch in Stockton in September 1995, which he claimed was the biggest china shop in the world. Three months later, the store burned to the ground, causing £2m of damage.
The branch was rebuilt and later expanded to include furniture and bedding showrooms.
Collectables recently opened an online store in an attempt to keep pace with changes in the retail industry.
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