Houseology Design Group, the Scottish interior design business with an array of heavyweight directors on its board, is hunting for a buyer for its retail arm after appointing administrators.
The Glasgow-headquartered company, chaired by former Skyscanner finance chief Shane Corstorphine and backed by investors including ex-Tesco boss Sir Terry Leahy, is understood to have called in restructuring experts at Leonard Curtis, with 23 staff being made redundant.
This comes after Houseology.com, the group’s online business-to-consumer (B2C) division, suffered “exceptionally poor” trading over the critical Christmas and New Year period. Bosses cited “wider market dynamics” as affecting performance at the retailer.
Stuart Robb, who was appointed joint administrator with Michelle Elliot, said: “Unfortunately, having assessed the company’s trading and financial performance, it was not possible to continue to trade its e-commerce business, Houseology.com and, as such, 23 employees have been made redundant with immediate effect.
“We appreciate that this is disappointing news for the company’s staff and we are working with Partnership Action for Continuing Employment (PACE) to provide them with the best support possible.”
The interior design group comprises two main parts: Houseology.com and Bureau, a furniture consultancy aimed at businesses.
Bureau is unaffected by the appointment and will continue to trade as normal.
The company said it was hopeful of finding a buyer for its retail assets and cited a “best ever year” for Bureau, adding that it will focus on the business-to-business (B2B) arm going forward.
'Assets will prove attractive to a buyer'
Bill Currie, founder of the William Currie Group that specialises in investments in the retail, e-commerce and tech sectors; serial entrepreneur Bill Dobbie; and Mike Welch, founder of online tyre retailer Blackcircles.com, are among the high-profile names who have previously backed the group.
A Houseology spokesperson said: “The board explored a number of alternative options for the B2C division. Unfortunately, due to exceptionally poor e-commerce trading across the Christmas period and January and wider market dynamics that showed no signs of improvement in the short to medium term, administration was agreed to be in the best interests of the group going forward.
“However, we are confident that the group’s assets will prove attractive to a buyer in the days and weeks to come.
“The business will now focus on its B2B division, which experienced its best ever year in 2019 and is on track for continuing year-on-year growth in 2020.”
Last summer the group announced it was set to achieve record turnover of more than £14 million for 2019, hailing a compound annual growth rate of around 35 per cent since Andy Russell took over as chief executive in 2016.
Bureau was founded by Russell and acquired by Houseology four years ago. The consultancy's client list includes the likes of Skyscanner, FanDuel, Trainline, Chivas Brothers and Baxters.
A statement in July also said the Houseology group was gearing up for a fresh investment round within the next 12 months.