Alternative Plans, the London-based premium kitchen retailer, has been put into administration by owner Leo Caplan.
As reported on KBB, the Kitchen, Bed & Bathroom Trade Group, Caplan’s company Canburg, which also owns Smallbone of Devizes and Mark Wilkinson Furniture, called in the administrators for Alternative Plans in a pre-pack deal.
The retailer was immediately bought by a new company Flagtime Ltd, also owned by Caplan and set up specifically for this purchase. The administrator Begbies Traynor said that the sale to an associated company was the only option as no other buyer could be found.
It was then subsequently announced that the intention was for Flagtime Ltd to change its name to Alternative Plans Ltd in due course.
Founded by Laurence Pigeon and Keith Atkins nearly 30 years ago, Alternative Plans operates from two showrooms in London – Battersea and Notting Hill – and was bought out of administration by Caplan at the end of 2009.
The administrators said that since 2009 the company had made steady progress but had been hit by “a lack of conversion of enquiries into customer spending” and Canburg had pumped in more funds to keep it in business. But the ongoing recession meant that Canburg decided to sell but, despite some interest, couldn’t find a buyer and was unwilling to inject more cash in to shore it up.
The sale means that all employees are safe and all outstanding customer orders, valued at £346,000, will be honoured. The stores are still open and still trading.
The total debt accrued by Alternative Plans was £1.96 million, however Canburg and Caplan are by far the biggest creditor with £1.58m of that. The next biggest is HMRC with nearly £200,000. Suppliers that appear on the creditor’s list are owed comparatively insignificant sums.
Speaking to kbbreview, Caplan said that a more formal statement on Alternative Plans would be released soon but it was part of an ongoing consolidation and reorganization of the Canburg business.
“That part of the business was not core to what we do,” he said. “It’s fair to say it’s been an extremely expensive diversion from what we normally do. We are manufacturers of furniture and we’re concentrating on expansion. Last week we had a record number of designer visits.”
Caplan said that the closures of several Smallbone and Mark Wilkinson stores was purely strategic. “We’re concentrating all our money in refurbishing the stores that are in the right location and [those businesses] continue to improve massively.”
“There was a Mark Wilkinson store in Holland Park, another in St Johns Wood and another was opened in Belgravia. But all that meant was the Holland Park business was split between threes stores which is just crazy. So I closed the Belgravia store and its had zero effect on our sales.”
“Our message here is that we’re strong, we’re growing and we’re British. I’ve funded this myself since 2009. We have no bank debt, no overdraft and no loans. That’s pretty unusual on a £35m turnover business.”
Smallbone of Devizes and Mark Wilkinson Furniture, the two principle retail brands of Smallbone plc, were been sold to British entrepreneur Leo Caplan for an undisclosed figure in 2009 and the move came as Smallbone plc was placed into administration.
Caplan had bought the business via his holding company Cranburg, which was formed specifically for the transaction, and who then put in place the senior management team which included Mark Wilkinson and Martin Warbrick. Smallbone plc chief executive Charlie Smallbone did not have any involvement with the new company and the reason for Smallbone suspending its shares from the stock exchange and putting itself up for sale, was the admission of falling sales and resulting cash flow difficulties.