Suppliers to the luxury department store Harvey Nichols are expressing caution and concern following its recent takeover by Mike Ashley's Frasers Group. Some fear being left out of pocket due to late payments, a sentiment echoed by experiences with Ashley's previous business dealings.
Concerns have been amplified by the collapse of the online fashion retailer Matches Fashion, which Ashley acquired in 2023. The company subsequently went into administration the following year, reportedly owing £210 million to approximately 541 creditors. Among those affected were high-profile brands like Burberry, Gucci, Prada, and Toteme, which allegedly recovered only a fraction of their outstanding debts.
A fashion industry executive noted that many brands would be wary of engaging with any entity associated with the Frasers Group, likely demanding stricter payment terms. Data from PaymentCheck, a tracker of late payments, indicates that a significant 34 percent of payments from Frasers Group were classified as late, presenting considerable unpredictability and cash flow risks for suppliers.
These anxieties come as some of Harvey Nichols' own suppliers face potential losses amounting to hundreds of thousands of pounds on their invoices. The department store entered administration this month before being acquired by Frasers Group for £40 million.
Customers may also encounter difficulties obtaining refunds, as Harvey Nichols closed its website last week, stating that orders placed before August 13 fall under the previous ownership and cannot be processed.
In a move to address some immediate concerns, Mike Ashley has committed to paying outstanding sums to self-employed personal shoppers and stylists who had not been paid by Harvey Nichols. The total payout for these individuals is in the six figures, with some owed as much as £20,000.
Frasers Group has stated plans to integrate Harvey Nichols into its existing luxury business. However, the group has not yet commented on Ashley's strategy for rebuilding confidence among the suppliers essential to his ambitions for the department store.