Background to the transaction:

Germany–based womenswear retailer and wholesaler Basler Fashion Gmbh went into self administration, following poor trading and a resulting lack of liquidity.

ERS was appointed as Agent to manage the retail/wholesale part of the business, including both Basler’s main brands (Basler and St Emile).

Key trading initiatives:

The initial phase of trading was conducted whilst a buyer was sought for the business. With no going concern buyer found the stores/business moved into full liquidation and were closed on a phased basis over a 7 month period.

In total 246 stores and 1272 wholesale partners were traded across 7 countries  (Germany, US, France, UK, Canada, Australia, Spain).

In addition to managing the store operations, discount strategy and advertising campaign, ERS took full responsibility and accountability for:

• Managing 2 stock warehouses
• Managing accounts receivable
• Negotiating with existing wholesalers for additional stock and improved terms
• Negotiating with additional retail partners to sell stock on a consignment basis and managing the return;100 additional POS were added to assist in clearing the stock
• Assisting the administrator in appointing administrators/lawyers in different jurisdictions (US, Canada, France, UK, Australia)
• Managing the liquidity/cash forecast of the business in conjunction with the administrators.

Results:

The trading performance was considerably better than administrator expectations and company historic performances:

• Sales improved by 200% across the trading period; final inventory recovery was >150 % of cost price

Aggressive management of the AR resulted in a higher return than forecast

80% of store staff were retained until the final store closures and no adverse publicity was received as a result of the liquidation.

The US business traded solvently through its existing partner (Bloomingdales), as ERS contract negotiations removed the original contract liability.