Nearly 1,000 jobs at risk as Ted Baker prepares to appoint administrators

Ted Baker's division responsible for retail and online operations in Europe is reportedly in the process of hiring administrators. This puts the livelihoods of almost 1,000 employees working for the UK-based company at risk.

The apparel company, with 46 outlets located in Europe and the United Kingdom, has been facing significant challenges over the past few years, as it contends with tough competition and the aftermath of its founder, Ray Kelvin's resignation from the company in 2019, following accusations of misconduct over "forced hugging."

Back in 2022, a retailer that was already listed at that time and was present in 500 shops and concessions all over the globe. Subsequently, this same retailer came to an agreement to sell out for a reduced price of £211m to Authentic Brands Group (ABG), which is a U.S.-based group that has ownership of Reebok as well as a share in David Beckham's merchandise and apparel empire.

The holding company for Ted Baker's European retail division, called No Ordinary Designer Label (NODL), has recently disclosed its financial situation. According to the latest accounts given at Companies House, NODL recorded a pre-tax loss of £43 million for the year ending January 2022, despite generating almost £320 million in sales.

During that period, the unit had a labor force of approximately 1,200 individuals in the United Kingdom, almost half of which worked at the corporate headquarters. Presently, it is believed that the unit's personnel count in the United Kingdom and mainland Europe has decreased to 975.

ABG has been thinking about what to do with NODL since January when it ended an agreement with AARC, a Dutch company that ran Ted Baker's physical stores and online shopping in the UK and Europe.

The company has shops located in Europe, the US, Asia and the Middle East. They also conduct sales to department stores and license other brands, particularly focused on children's clothing and lingerie items, which are managed by Next. The licenses, franchises, and the business in the US are believed to remain unaffected by the challenges experienced at NODL.

According to John McNamara, who is the head of strategy and transition at Authentic Brands Group, even though they worked tirelessly, the harm that was caused during the time NODL accumulated a substantial amount of debt under AARC was not something they could fix.

We genuinely hope that the Ted Baker workers and investors could have had a more positive result. However, we want to offer some comfort to our clients that NODL will still operate both online and in physical shops.

Our main priority is to find a fresh associate who will maintain and expand the Ted Baker label in the regions of the UK and Europe where it originated.

Authentic Brands announced that Ted Baker stores and the retailer's website will remain open and function as usual despite the administration.

In the previous month, Ted Baker was said to be thinking about going through an insolvency procedure to be able to shut down some of its stores because it was experiencing financial strain due to the expensive rental fees at its UK branches.