Giants of the Industry in Trouble
I tweeted about the doom and gloom in the industry, earlier in the week and since then have heard that upmarket Crabtree Kitchens (based in Bristol and London - with an average kitchen price of around £40,000) has gone into administration. So has high profile Kitchen Clinic (based in Battersea and Shepherd's Bush).
Swedish giant Nobia, which owns Magnet, Magnet Trade, Pronorm, Gower and Poggenpohl announced a drop of 35% in operating profits for the year to December 2008 ... but the last quarter of the year was particularly bad, with a loss of £1.6m, compared to a profit of £10.5m for the same period in 2007. They're probably hoping for a better performance from Magnet, now that MFI has gone.
Even more startlingly; the mighty Smallbone is now up for sale - announced yesterday, with a suspension of trading in their shares - putting Mark Wilkinson Furniture at risk too.
Charlie Smallbone and Mark Wilkinson were both founders of Smallbone in the 1970's but Mark Wilkinson left in 1981 to set up his own Mark Wilkinson Furniture (MWF). Smallbone had a couple of different owners but was sold back to Charlie Smallbone and then, in 2005, Smallbone bought MWF ... re-uniting the two names.
Mark Wilkinson must be gutted ... to have his name put at risk ... there has been a big expansion of MWF showrooms in the last few years, with one due to open imminently in Belgravia.
Only a few weeks ago, Smallbone announced a new finance deal which they said would allow them to keep trading in 2009, even without an increase in sales ... but it obviously wasn't enough ... so two more giants of the industry are in trouble.
Maybe a purchaser will come along willing to keep both names going and to maintain the quality of MWF kitchens. I hope so.
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Just an update on the Smallbone/Mark Wilkinson Furniture position. The companies went into administration on the 18th March ... but were immediately bought by Leo Caplan's Canburg company. He also owns the Morgan Brookes office technology company ... but is no stranger to upmarket kitchens, since he bought Brookmans Design Group when they got into trouble about three years ago.
The rescue safeguards around 400 jobs and it was also promised that orders already placed with Smallbone - with a deposit paid - would be honoured. Good news indeed ... although perhaps not so good for suppliers who probably won't get paid.
Charlie Smallbone doesn't appear to be involved in the new business but Mark Wilkinson will apparently continue as a designer and the two names will continue as upmarket luxury brands. The average price for a Smallbone kitchen, before the collapse, was £42,000.
Brookmans had "dumbed down" their kitchens before their demise - supplying John Lewis Partnership stores with good looking - but not bespoke - kitchens. Under Leo Caplan's ownership, they have moved back upmarket with bespoke kitchens and have also moved into property design. They'll design not only the kitchen but also the house to put it in ... as long as you have enough money!
I'm getting more shocked as time goes on! Both Scottwood and Shortland Crafts have now gone into administration. They're particularly significant to me because they're both local to Nottingham. Scottwood was based in Bulwell and Shortland Crafts out at Langar (they also had showrooms in Oakham and Stamford).
Scottwood used to have a very grand showroom in the city centre, years ago, but they moved a little bit downmarket when they became a trade supplier. Shortland, on the other hand, couldn't have been much more upmarket. I went and asked the late Mr Shortland senior for a job ... ooh, more than ten years ago (never one to let lack of experience put me off). He was charming, explaining how everything in their kitchens was bespoke - even the handles were made specially - and he suggested I come back when I'd got some experience of bespoke kitchens (I did get that experience - but I never went back).
There has also been a report that Underwood Kitchens have put part of their business into administration ... but that was, apparently, a technical move to get out of a lease on a London showroom ... and reduce costs.
The administrators are looking for a buyer for Scottwood and I think Shortland are hoping to make a comeback themselves. The top end of the kitchen market looks set to be quite different in years to come, though.
Yes I heard they'd been bought ... seems like a good fit and Crabtree's Barnes showroom will stay open as "Crabtree by Finewood". They've also found jobs for Patrick and Alexandra Crabtree - so retaining the family connection.
Shocking though many of the changes seem, I guess there'll be a leaner and fitter, upmarket, bespoke kitchen sector ... at the end of it all.
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