Fashion and furniture chain Laura Ashley has become the latest casualty of the coronavirus pandemic.
Just two weeks after regional airline Flybe collapsed, the retailer has said it will have to call in administrators putting 2,700 jobs at risk.
It is one of the many firms reeling from the impact of the coronavirus, with the government advising people to avoid unnecessary contact with others.
The collapse comes as the chancellor prepares fresh support for companies.
Firms from many industries including airlines, retailers, restaurants, theatres and pubs have said the virus has pushed them to the brink, with several warning of imminent collapse without government help.
Chancellor Rishi Sunak has already announced a £12bn Budget package to help businesses deal with the crisis, including business rates relief and a new hardship fund, but said in his Budget speech he would “not hesitate to act” if more was needed.
He is expected to unveil new financial measures to help deal with the effects of the outbreak in the government’s daily briefing on the outbreak on Tuesday afternoon.
Carolyn Fairbairn, head of the CBI business lobby group, called for co-ordinated and fast action to support businesses. “We do not want to look back and say we acted too late,” she said.
Ahead of the announcement, Robert Chote, head of the Office for Budget Responsibility, told MPs that Britain was facing something akin to a wartime situation for its public finances.
He added that now was not the time for the government to be hold back on spending.
Sectors which have warned of problems include:
- The hospitality industry warned on Tuesday that new government restrictions around coronavirus could shut down firms.
- Cafe chain Carluccio’s said it could see closures “in days” due to the impact of the virus
- Airlines have had to cancel thousands of flights and ground planes and airports have warned they may have to close down operations.
- The UK tourism industry is seeing a sharp drop in bookings amid travel restrictions across Europe and elsewhere.
- Cinema chains Odeon, Cineworld and Picturehouse will temporarily close their doors until further notice.
Most businesses do not have insurance cover to compensate them for coronavirus losses, a trade body and other experts have said.
Small businesses, in particular, are unlikely to have such a policy.
Laura Ashley said the outbreak “has had an immediate and significant impact on trading”. It had been in talks with its lenders about accessing more funds to continue trading.
But based on cashflow forecasts and continued virus uncertainty, it said it would not get that money in time.
The firm, which was also facing challenging High Street conditions, said: “The Covid-19 outbreak has had an immediate and significant impact on trading, and ongoing developments indicate that this will be a sustained national situation.”