Wedo Shopping Limited was placed into creditors’ voluntary liquidation on the 26th August 2015. Carl Faulds and Michael Fortune of Portland Business and Financial Support were appointed joint liquidators
The company was incorporated in November 2005 and originally traded as a software developer specialising in ecommerce software for online retailers. In early 2011, following the development of successful software over several years the company opened its own online store to become an online retailer of beds and mattresses. To focus on the retail side of the business, the company ceased software development.
The company operated the online business successfully from a premise based in Kennington Business Park. In 2013 the company opened a retail store in Colchester, allowing customers to try beds in store before buying. As well as having its own website and store generating sales the company also had a sales agreement with Tesco, with orders being made through the Tesco website.
Although there was a good level of turnover, it soon became apparent that the business model was not sustainable with many suppliers invoicing pro forma and payments from Tesco being made on a monthly basis resulted in significant cash flow difficulties. The company had invested substantial funds into the development of its own brand mattress, however unexpected supplier delays meant the “own brand” product was never brought to the market this further forced the cash flow issue faced by the company.
The company made a number of changes to cut costs, including dispatching products directly from the factory to the customer, reducing the stock held in store and also allowing the company to reduce the number of employees. The retail store was later closed and the remaining online company restructured, moving to a smaller serviced office in Kennington Business Park.
The funding of the company had been met by the shareholders. Shareholders provided several injections of cash to the company in order to fund the shortfalls. With shareholders unwilling to provide further funding to the company, the director approached parties that it was thought may have an interest in purchasing the company, however there were a number of concerns raised by these parties, as a result no sale was achieved.
With no future funding in place and no buyer for the company or the business, the director of the company approached Portland for insolvency advice and concluded that the company must cease to trade and steps be taken to enter in to liquidation. On 31st July 2015 the director instructed Portland to assisted with the necessary steps to place the company in to liquidation.
Creditors can access the report here