Written by: Keith Tully
Published: 25th October 2019
The owner of the hairdressing chains Supercuts and Regis has entered into administration after struggling to make profits and failing to avoid insolvency.
Around 1,400 people are employed by Regis UK, which owns and operates a total of 223 hairdressing salons across the two brands.
It is not currently clear whether the chain of outlets will be acquired by a new buyer but Deloitte has now been called in to act as administrators.
Regis UK recently entered into a Company Voluntary Arrangement (CVA), officially a form of corporate insolvency, in an effort to restructure its operations and reduce its rent-related overheads.
However, the CVA process has not had the effect of reviving the fortunes of Supercuts and Regis salons.
An increasing number of retailers are entering CVAs as a means of reorganising and reducing overheads, although in some cases there have been legal challenges and push back from creditors about the terms of these arrangements.
Other companies that have pursued CVAs in recent quarters include Mothercare, Carpetright, New Look and Arcadia, which owns Topshop, Topman, Dorothy Perkins and Miss Selfridge.
Falling customer numbers and higher wages have been cited by bosses at Regis UK as making life more difficult for its hairdressing outlets, with the environment for retail businesses nationwide generally regarded as being very tough indeed.
In recent days, the British Retail Consortium revealed that there were close to 85,000 retail sector jobs lost over the course of the year to the end of September.
“The retail trading environment in the UK remains extremely challenging and Regis UK Limited had been seeking to address this through a restructuring of its business,” explained Rob Harding, one of the newly appointed administrators at Regis UK.
The several hundred Supercuts and Regis salons will continue to operate as normal for now while administrators look for potential new buyers and consider how best to move forward.
“The group operates two very strong brands and we are working with all key stakeholders to stabilise the situation and provide the best solution possible,” said Mr Harding from Deloitte.