Future of furniture business uncertain after losses reach almost £500k

The future of furniture manufacturer Acclaim Upholstery remains uncertain after it filed a notice of intention (NOI) to appoint administrators.

It is understood that the Long Eaton-based business is struggling following its latest set of accounts with sales for the eight-month period ended March 2022 fell to £7m from £10.6m against the prior year.

Pre-tax losses resulted at £465,000, significantly down from its profit of £268,000. Detailed in the accounts, the business currently employs around 144 staff.

By filing the NOI, it offers protection from creditor action for a period of 10 days, allowing time for the company to review potential next steps.

Furthermore, the accounts state that year end cash dropped to around £4,000 from £200,000, with creditors falling due within one year valuing £2.3m, up from £1.3m.

The report states: “Gross margin was significantly impacted due to the cost of raw materials; this was caused by shortages and price inflation due to the scarcity of goods and this issue has continued through 2022.”

The business added that it was unable to pass on any increases in costs due to a contract it had in place with its largest and main customer. This led to the fall in margin and the incurred losses.

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