Despite being one of the biggest fast fashion players in the UK, Missguided was struggling to make a profit.
👉 Background: Missguided is a UK-based online retailer that launched back in 2009, pioneering the social-first model. They've got 9.2 mil followers on IG, 1 mil on TikTok and collaborations with Sofia Richie and Nicole Scherzinger under their belt.
👉 What happened: Despite growing to be one of the UK's biggest online fashion players, Missguided struggled to turn a profit in the past few years and was bought out by a finance firm last year.
👉 What else: Now just a year later, the company has collapsed into administration, owing MILLIONS to suppliers. In fact, reports say Missguided continued to order goods despite knowing it has headed towards insolvency.
💡Insolvency is the term used when a company - or an individual - can no longer meet its financial obligations. In other words, it can't pay its debts when they become due.
💡Trading while insolvent is a huge no-no for companies globally, because doing so tends to create collateral in the company's downfall... Like employees owed wages, suppliers owed payment and lenders owed repayment.
💡Between 4-10K companies become insolvent in Australia each year, so it's a widespread issue. Hopefully all of Missguided's creditors and employees will be able to get their money, otherwise the company's directors could be in trouble.
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