Business

High street shops that have come back from the brink

Malcolm Winn and Colletta Smith
Image caption Malcolm Winn: "It's tough not knowing if you've got a job in a week or a month's time"

When high street stores go into administration, it's easy to assume another brand has bitten the dust.

People start mourning their products, their cafes, and even their easily accessible toilets.

Many already assume that the eclectic mix of goods in BHS will be added to the nostalgia list, along with pick 'n mixes from Woolies, videos from Blockbuster and books from Borders

But alongside the closures, there's another story happening.

It's just nobody is shouting about it.

Spending the day in Shrewsbury for BBC 5Live, I discovered that plenty of stores who went into administration are coming out the other side.

Malcolm Winn works in the outdoor shop Blacks, and there's one question he's fed-up with people asking him: "People are always coming into the store and asking when we're closing. It's frustrating to keep having to explain to people that we've been bought, we're doing well, and we're here for the long-term."

Image copyright iStock

On Christmas Eve 2011 it was a different story. The company couldn't pay its debts and its staff so Blacks Leisure Group entered administration.

For Malcolm that was an incredibly difficult time: "It's very tough, not knowing if you've got a job in a week or a month's time. It's tough personally and also for your team - people who you consider to be friends. It's just the not knowing. But thankfully for us somebody did come along and purchase the company and here we are today."

That 'somebody' was JD Sports. It spotted something good in Blacks despite all the financial problems.

Lee Bagnall who's in charge of the Outdoor division at JD told me: "We knew that we could put a proposition together that customers would like.

"What we have done is reduce our cost base because we've used the JD muscle, and that's made us as an outdoor division a bit more nimble. We've been able to deliver the product to the customer that they want at the prices that they want to pay."

Along the main shopping streets in Shrewsbury there are lots of names we've heard in the headlines, but they are still trading. There used to be three Clintons card shops in this town, now there's just the one, but it's still here. There's an HMV, and a Game shop.

On the second floor of the Pride Hill shopping centre there are lots of strange noises coming from the Hawkin's Bazaar shop. Its story is one of the most dramatic.

There used to be nearly 130 stores and wholesale businesses, selling cheap gifts, before they went into administration. After the company came out of administration in January 2012, there were just eight.

The existing management bought the company back from the administrators, and its new chief executive David Mordecai said they had learnt lots of lessons. It ended up stocking much more expensive products to boost the amount of money they made from each customer.

"We included stuff like scalextrics and Hornby and drones", he told the BBC.

"At the end of the day you need to stock what the consumers want. The idea was to stock some higher priced items to allow us not to worry so much about how many people were on the high street."

Image copyright Thinkstock

Administration was a painful way to learn that lesson, but now they have more than 30 stores. Small steps, but definitely growth.

Nobody is saying going through administration is easy, as anyone working at BHS will be able to tell you.

Malcolm Winn from Blacks understands how those 11,000 staff at BHS are feeling right now, and he has a positive message for them: "Be optimistic. It happened for us. Lots of companies are interested in BHS, so hopefully it'll happen to you too."

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