Joules will file for bankruptcy in England, 1,600 jobs threatened

British clothing company Joules is set to file for bankruptcy after running out of cash as the cost of living crisis prompted consumers to cut spending in the face of inflation.

In a statement Monday, Joules said it failed to raise funds from investors and failed to secure a bridging loan.

“With regret”, the board of directors has announced its intention to appoint three directors of the firm Interpath Advisory Limited, in order to “protect the interest of creditors”.

The company currently employs 1,600 people, whose jobs are threatened, and has 132 stores, a spokesman told AFP.

The action was suspended on the London market.

“Joules is the latest victim of the UK retail crisis, in a context of purchasing power crisis,” commented Victoria Scholar, an analyst at Interactive Investors, who recalled that last week the company furniture e-commerce Made.com, also went bankrupt.

Inflation has reached 10% in the country and rising costs are weighing on business activity and indicators of confidence in the economy.

The UK saw its gross domestic product shrink in the third quarter and the Bank of England is predicting a recession that could be the longest known in the country.

Susannah Streeter, an analyst at Hargreaves Lansdown, points out that the brand specializing in outdoor and countryside clothing, and famous for its colorful rain boots, may also have suffered from unusually warm weather this autumn but “Joules would have better weathered this storm if its product line had been more diverse and if its design teams had followed trends better.”

London, Nov 14, 2022 (AFP)