It was the beleaguered stationery giant that struggled to compete with wallet-friendly rivals and had been blasted for ‘going woke’ by customers.
And now, almost 55 years since its first store opened in Kensington, London, Paperchase looks set to become the latest victim of Britain’s high street implosion.
The company was brought today by Tesco, hours after Paperchase announced it had fallen into administration following years of plummeting sales and soaring costs.
But the purchase looks unlikely to save any of the company’s 106 shops, which aren’t included in the takeover – with 800 jobs now in the firing line.
High street stationery chain Paperchase has fallen into administration, risking 820 jobs
Tesco said it had bought the Paperchase brand and intellectual property, with new products expected to rollout in its stores in the UK. But the grocer had no interest in buying the brick and mortar assets, which look set to be axed.
The deal came after Paperchase was unable to find a buyer for the whole business after putting itself up for sale several weeks ago.
Founded in 1968 by art students Judith Cash and Eddie Pond, the firm has been struggling for years, going through a form of insolvency proceedings four years ago to cut stores and hack back costs.
It was then bought out of administration in 2021 during the pandemic in a rescue deal that saw around 500 jobs axed.
As well as the firm’s financial difficulties, Paperchase has also seen itself embroiled in a series of public rows in recent years.
In 2017 it enraged customers after caving into demands from an anti-press freedom group to not advertise in the Daily Mail.
Social media users moaned over the one-off advert, with left-wing Stop Funding Hate leading demands to boycott the stationery business.
Bowing to online pressure at the time, Paperchase took to Twitter and declared: ‘We’ve listened to you about this weekend’s newspaper promotion.
‘We now know we were wrong to do this – we’re truly sorry and we won’t ever do it again.
‘Thanks for telling us what you really think and we apologise if we have let you down on this one. Lesson learnt.’
But the move was met with a furious backlash at the time, and branded as ‘bloody absurd’ by journalists, with Piers Morgan tweeting: ‘I hope @FromPaperchase understand that British people don’t like snivelling little cowards who let themselves get bullied into virtue-signalling bulls**t. I’ll buy my cards from @ClintonsTweet in future.’
And with Tuesday’s announcement that the Paperchase had now collapsed into administration, people took to social media to mock the firm, saying: ‘Go woke, you go broke’.
Paperchase ignited fury after bowing to pressure from left-wing anti-press groups to not advertise with the Daily Mail
More recently, the high street store had faced mounting criticism from artists for allegedly not paying for designs.
Angela Chick, from Portsmouth, Hampshire, claims she was left more than £22,000 out of pocket after Paperchase stopped paying its invoices for her designs.
She started supplying the firm in 2020 and said her hand-drawn cards had proved a hit, having previously sold at the likes of Selfridges, Next and House of Fraser.
But the small business owner claimed that multiple emails to the Paperchase, demanding payment, went unanswered.
Then news broke in January 2021 that the company was going into administration.
Speaking to The Guardian in May 2022, Angela said the whole ordeal had been ‘immensely stressful’.
‘I was going through this, and having people sending me photos of my cards still in their stores that were available for sale. It was like, “Hang on a minute. Somebody’s making money off these, but I haven’t”.’
‘Most customers have no idea,’ she added. ‘Nothing changes in the shops; it’s still the same Paperchase.’
Paperchase is the latest victim to be wiped from Britain’s high street. Pictured is a store logo in London on January 31, 2023
Angela was part of a group of artists from across the UK demanding for increased protection for small firms after they were hit by the collapse of Paperchase in 2021.
Some were initially offered a proportion of the cash they had lost as a ‘goodwill gesture’ by the firm – 15 per cent in Angela’s case. But the small business owner claimed this offer was on the condition of them working with the new owners.
‘I couldn’t risk that happening again, so I refused,’ she added. ‘I was thinking I’d just hold out because I might end up getting something. But I was very wrong about that.’
At the time, Paperchase said: ‘The cumulative effects of lockdown one, lockdown two – at the start of the Christmas shopping period – and now the current restrictions have put unbearable strain on retail businesses across the country.’
At the same time, the company was competing with the rise of wallet-friendly firms like Card Factory, which claimed to be the largest card retailer by volume in the UK in 2021.
Card Factory said it had managed to ‘bounce back’ following pandemic lockdowns in 2020 and 2021 when non-essential shops were shut.
While Paperchase admitted it had struggled to recover after the pandemic.
Paperchase’s demise is yet another blow to Britain’s high street, which has faced a punishing few years, following the likes of Joules, Debenhams, Monsoon and the Arcadia Group in shutting up shop for good.
Department stores used to be commonplace on high streets but in recent years they have been moving away from the centres of towns and cities
The number of tattoo parlours and piercing studios on High Streets has increased significantly since the Covid-19 pandemic
Since the Covid pandemic forced businesses to close in March 2020, Britain’s main shopping hubs have become increasingly dominated by hairdressers, tattoo parlours and cafés.
While the likes of department stores, clothes shops and banks have seen significant drops in numbers following the two years of lockdowns and trading restrictions.
The changing composition of Britain’s High Street’s was revealed in analysis by the BBC in December based on data from Ordnance Survey.
Between March 2022 and March 2020 there was a decrease of 9,300 retail outlets as shoppers decided to use online stores.
Paperchase: growing from a dream by a pair of art students to a British high street giant
Paperchase opened its first store in Kensington, London, in 1968.
It enjoyed years of success, opening concessions at Selfridges, Next and House of Fraser as well as in train stations such as London Euston.
The very first Paperchase store open in Kensington, London.
Paperchase opened its first ‘stationery-at-the-station’ store at London Euston.
The first Paperchase in the Middle East opens.
Paperchase launched their website.
Paperchase opened their 100th standalone store, as well as its third flagship store in Glasgow.
Paperchase opened its first London Underground store.
Ireland’s first standalone Paperchase store open in Dundrum, Dublin.
Paperchase collapses into administration with PwC.
The data also shows that Britain’s High Streets are becoming places where people do things rather than buy things – as highlighted by a large rise in the number beauty salons and cafés.
The number of clothes shops operating in Britain is down 4,300 since March 2020 and there are more than 800 fewer High Street banks.
But there are 350 more tattoo studios, 700 more pubs and bars, 2,000 more cafés or tea rooms and 4,600 more fast-food outlets.
Before being bought by Tesco, Paperchase had appointed administrators from Begbies Traynor to oversee the insolvency process.
The administrators said: ‘On January 31, Mark Fry, Kirstie Provan and Gary Shankland, of Begbies Traynor, were appointed as joint administrators of Aspen Phoenix Newco Limited, which trades as Paperchase.
‘Unfortunately, despite a comprehensive sales process, no viable offers were received for the company, or its business and assets, on a going concern basis.
‘However, there has been significant interest in the Paperchase brand and attendant intellectual property.
‘The joint administrators will continue trading the company’s operations in the short term, with all stores remaining open and trading as normal.’
Speaking after announcing it had Tesco had bought the intellectual rights to the company, Jan Marchant, managing director of home and clothing the grocer, said: ‘Paperchase is a well-loved brand by so many, and we’re proud to bring it to Tesco stores across the UK.
‘We have been building out plans to bring more brands and inspiration to the ranges we currently offer, and this will help us to take those plans further.
‘We look forward to sharing more with our customers in due course.’
In January 2021 the Paperchase went into administration with PwC and was sold weeks later in a pre-pack deal, saving around 1,000 jobs when newly formed company Aspen Phoenix Newco took control of the firm.
But the company was then sold again in August last year to a private investment firm led by the retail investor Steve Curtis.
Begbies said it would continue to ‘monitor trading’ in Paperchase’s stores and provide further updates on the business’s future soon.
Full list of Paperchase stores that are now at risk of being closed
Grand Central Birmingham
New St Birmingham
Bury St Edmunds
Cardiff St Davids
Henley on Thames
Kings Cross Station
Leeds Commercial Street
Next Birmingham Junction 9
Next Handforth Dean
Next London Colney
Next Manchester Arndale
Next Oxford Street
Next Selly Oak
St Pancras Circle
St Pancras Station Street Outlet
Trafford Centre Selfridges
Walton on Thames
White Rose Leeds
Read the full article here
Discussion about this post