Arcadia cancels supplier orders amid coronavirus crisis
Sir Philip Green’s Arcadia has cancelled all orders from its suppliers and extended its payment terms as it seeks to conserve cash during the coronavirus pandemic.
Arcadia, which owns high street giants Topshop, Dorothy Perkins and Burtons, has written to its supply chain to say all orders have been cancelled and payment terms will be extended by 30 days.
Other major UK retailers including Primark and New Look have also taken similar steps to protect their businesses as sales plummet due to the coronavirus crisis. The government has ordered all non-essential retail stores to close in order to slow the spread of the virus.
“As many of you will be aware, following UK government intervention, we were forced to close our stores last week to safeguard the welfare of our employees, customers and communities,” Arcadia said in the letter, according to industry magazine Drapers.
“You will appreciate that this has significantly hindered our ability to make use of any goods supplied by you and has dramatically reduced the revenue coming into our business.
“As a result, we need to take action wherever possible with each of our stakeholders to preserve the future of the Arcadia business for the benefit of our employees, suppliers and customers.”
Arcadia has also suspended payments to its pension scheme during the pandemic.
Arcadia has secured the backing of its pension trustees to halt the contributions, which were agreed with the UK’s pension watchdog last year, Sky News reported.
The group is supposed to pay £25m a year into the scheme over the next three years.
Arcadia declined to comment.