Bag Shop goes into liquidation Sunday, June 07, 2009 By Ian Kehoe The Bag Shop, a nationwide chain of 35 luggage and bag stores, has become the latest high-street casualty of the economic downturn.
The chain went into provisional liquidation late last week after running out of cash. The retailer owes significant sums to the Revenue Commissioners and its trade creditors.
Derek Earl, a corporate recovery partner with Grant Thornton in Dublin, has been installed as provisional liquidator to Form view, the holding company behind the Bag Shop chain.
The move came following a petition by the company’s directors. All of the company’s 35 outlets stopped trading last week, but the provisional liquidator re-opened seven of the stores yesterday morning, including outlets in Galway, Dublin, Carlow, Athlone and Limerick.
Earl is assessing the company’s options, and plans to sell off its stock over the coming weeks.
Most of its 135 staff will lose their jobs. A full hearing on the appointment of a official liquidator to the company will be heard later this month. At its peak, The Bag Shop had more than 40 outlets, but a number of stores were closed in recent months as the company sought to rein in costs.
Established in 1989,The Bag Shop sold suitcases, hand bags and backpacks, as well as accessories such as purses and wallets. The company is owned by Kevin and Vera Duffy, who both have an address in Clontarf in north Dublin.
According to its most recent accounts, Formview had sales of €7.9 million in 2006 and made a pre -tax profit of €237,000 for the year. The company owed creditors €1.9 million at the end of 2006.
However, the company has come under increasing pressure with the fall-off in retail sales and high rents and attempted to refinance its debts.
The company experienced a significant cashflow problem in the past few weeks, triggering the appointment of the liquidator.
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