1st October 2012 is another sad day to mark down in the calendar of the stricken high street. It was announced on this day (yesterday) that a last attempt to save the high street chain, once worth a quite impressive £1billion, had fallen through and that only 20 stores were to be saved.
It has left an eye watering 2200 people out of work. The 20 stores that have been saved have been bought by Newcastle United owner and Sports Direct founder Mike Ashley, along with one of their main warehouses. This small purchase had saved around 550 jobs in total. So some very lucky JJB employees there. Unfortunately the company was not lucky enough.
JJB has suffered for a long time under mounting debt and falling share prices. One of the major issues in trying to sell the business was it’s ability to pay back it’s creditors. One of JJB’s final nails in the coffin was when investor Dick’s Sporting Goods wrote off it’s £20million investment it had placed in August to try to help turn around it’s fortunes. If you have investors writing off that amount of money just eight weeks after investing, you know you’re done for.
Obviously this isn’t about double glazing. But I have been charting the fortunes of high street companies for a while on this blog, for a couple of reasons. One, it’s nice to read something else other than windows I think sometimes. But also because the failing fortunes of the high street companies can teach us all a valuable lesson. That lesson is keep diverse, don’t take your eye off the ball, don’t hold ever increasing amounts of debt as it will eventually come back to bite you in the arse as it has done here.
It is sad to see another high street store disappear. I know that Mary Portas is doing, or has done her review of UK high streets to find out why they are suffering so badly. But now has to be the time where the Government follows up on those findings and starts to implement some changes. High streets are the centre of a lot of town’s and cities economies up and down the UK and they simply cannot afford to be just left to wither and decay.