Children’s furniture and toys importer Chelford suffered from reduced sales and the loss of a major customer in the build up to its administration.

Mike Dillon and Katy McAndrew, both of Leonard Curtis, were appointed as joint administrators of Chelford Limited on 7 August 2023.

Detailed in newly filed documents on Companies House, the business, which historically traded profitably with profits of £35,000 recorded for the year ended 2020, saw sales decline due to the impact of Covid with customers placing lower and less frequent orders. At the time of administration, customer numbers stood at 20 when compared to peak times with customers at 1,500.

In addition, the company also became aware that one major customer had started sourcing from China, which resulted in the business being unable to meet loan repayment requirements.

Before entering administration, the business was marketed for sale from 11 July to 17 July 2023, which saw 12 expressions of interest from unconnected parties and one from a connected party. Five of which returned non-disclosure agreements, while only one offer was submitted.

Upon appointment of administrators, the sale of the business was completed to connected company Chame Ltd for a total sum of £27,558, with £7,558 paid on completion. Four payments of £5,000 from September to December are expected to fulfil the sale.

As for creditors, secured creditor Royal Bank of Scotland were owed £31,000 and are expecting to receive a contribution of £5,000 following the sale. Aldermore Bank, owed £2,500, are expected to be repaid in full, while the HMRC is owed £10,000 and is not likely to receive any distribution.

As for unsecured creditors, claims totalled £465,000, with the majority of £427,000 being owed to various loans. These included £250,000 owed to Funding Circle and £177,000 owed to Kriya Limited. A further £17,000 is also owed to the HMRC. It is expected that creditors will suffer a total shortfall of £460,000.