Safestyle falls – more to come?
It was common knowledge that Safestyle had been teetering on the edge for some time now, but at the end of last week, after failing to find a buyer, it was announced that the company had finally called in the administrators.
The fact that the writing was on the wall will provide little comfort to the 680 or so workers that have been made redundant from the Bradford based firm. According to the BBC, employees were told the news in the company car park, with some getting a text message telling them to down tools.
Anyone who has an order placed with Safestyle will now not receive that order, part finished installations will need to be completed by another installer and deposits will need be reclaimed through credit or debit card providers. Any deposits paid in cash will be lost.
Safestyle’s announcement coincides with a bleak outlook for UK businesses in general, with news that 2023 will see the highest number of companies going bust since the financial crisis of 2009.
Official figures also show that insolvencies are up 10%, year on year, and the number of firms in ‘critical financial distress’ has increased by 25% in the last three months.
According to a statement from Interpath Advisory, ‘Safestyle UK has had to navigate a number of pressures which have impacted trading, including high-cost inflation, ongoing economic uncertainty and fragile consumer confidence.’
It adds that ‘an unseasonally warm September’ has also ‘dampened customer demand’.
While all that may be true, it could also be argued that another contributing factor in this case, would be a business model geared towards high volume sales, and at any cost.
It was a model that survived the pandemic thanks to the unprecedented demand for home improvements, but ultimately, it proved to be unsustainable.
And there’s a strong chance that Safestyle will not be the last high-profile company to fold, because – according to industry insiders – there are others that are operating in a similar fashion and are currently in a very tenuous position.
In contrast, those companies who have had the confidence to maintain higher prices, backed up with quality products and quality service, are now much better placed to navigate the more turbulent economic conditions we now find ourselves in.