The well-known high street chain has drafted in specialists PwC to handle the administration process. A staggering 40 percent of the company’s sales are usually made in the busy festive months of November and December. But the Covid pandemic has rocked the business, putting the card and gift retailer in danger of folding after coronavirus restrictions placed an “unbearable strain” on its Christmas sales.
A spokesperson on behalf of Paperchase said: “The cumulative effects of lockdown one, lockdown two – at the start of the Christmas shopping period – and now the current restrictions have put an unbearable strain on retail businesses across the country.
“Paperchase is not immune despite our strong online trading. Out of lockdown, we’ve traded well, but as the country faces further restrictions for some months to come, we have to find a sustainable future for Paperchase.
“We are working hard to find that solution and this NOI is a necessary part of this work.
“This is not the situation we wanted to be in. Our team has been fantastic throughout this year and we cannot thank them enough for their support.”
READ MORE: Tesco, Sainsbury’s and Asda to see huge change in store layout
The stationery and gift card shop launched a Company Voluntary Arrangement (CVA) restructuring in March in an attempt to turn around its fortunes but saw this heavily impacted by the pandemic.
Approximately 1,500 jobs and 127 stores would be impacted by the collapse, news of which comes after the UK was placed into another national lockdown in a bid to curb a winter surge in COVID-19 infections as a more virulent strain of the pathogen plagues Britain.
Paperchase, which has been experiencing losses for some years, fell casualty to the Covid restrictions placed on the UK towards the end of 2020.
Non-essential retail in England was subject to lockdown restrictions from November 5 to December 2, in parts of Scotland from November 20 to December 11 and in Wales from October 23 to November 9.
Mr Sunak also announced a further £594 million for local authorities and devolved administrations to support businesses not eligible for the grants.
The Scottish Government will receive £375 million, the Welsh Government £227 million and the Northern Ireland Executive £127 million.
Mr Sunak said: “The new strain of the virus presents us all with a huge challenge – and whilst the vaccine is being rolled out, we have needed to tighten restrictions further.
“Throughout the pandemic we’ve taken swift action to protect lives and livelihoods, and today we’re announcing a further cash injection to support businesses and jobs until the spring.
“This will help businesses to get through the months ahead – and crucially it will help sustain jobs, so workers can be ready to return when they are able to reopen.”
