The 50-strong flooring chain backed by Sir Richard Harpin’s Growth Partner has appointed restructuring advisers, raising the prospect of store closures and job cuts as cost-of-living pressures continue to drain consumer spending.
The Flooring Superstore, which employs around 300 people from its Bishop Auckland headquarters in County Durham, has written to Begbies Traynor and restructuring arm Santander to weigh its options. People familiar with the matter said a company voluntary arrangement (CVA) or full administration are both on the table, controversial routes that tend to squeeze landlords and suppliers while preserving the equity of existing owners and major creditors.
The retailer was founded in 2012 by Dan Foskett and sells vinyl, laminate and wood flooring alongside artificial grass through its branded showrooms and online channels. Growth Partner, the investment vehicle set up by Harpin, the entrepreneur behind home emergency repair group HomeServe, backed the business in 2020 with a £5 million injection which allowed Foskett to make up part of his share. He retained 22 percent, while Growth Partner had 25 percent. The rest is split between the three investors individually.
Harpin, who last year published “How to Make a Billionaire in Nine Steps”, specializes in British and European marketing names aimed at scale. His portfolio includes pizza oven specialist Gozney and bathroom retailer Easy Bathrooms. However, several Growth partner-backed businesses have collapsed in recent years, including Crafters’ Companion, co-founded by Dragons’ Den investor Sara Davies, and Yorkshire-based Keelham Farm Shop.
Flooring Superstore has succeeded in the pandemic, riding the wave of home improvement spending while consumers are stuck in their homes. That headwind backfired when the shutdown eased, as the chain was forced to rein in energy and raw material costs and release excess capacity it had built up. The cost of living crisis has since increased the need for big-ticket home renovations.
Connection Retail, the parent company which also owns Direct Wood Flooring, Grass Direct and Snug Carpets, posted a profit of £49.3 million in the year to the end of July 2024, down from £51.8 million the previous year. Pre-tax profit however changed from a loss of £3.3 million to a profit of £619,000, while total debt stood at £3.5 million at the end of the year.
Santander closed the group’s balance sheet last June with a debenture, a guaranteed loan agreement in which the lender acts as a security trustee. Filing at Companies House show Connection Retail has two outstanding charges, as it has pledged its property and its entire business assets as collateral for both Growth Partner and the high street bank.
The disclosed restructuring talks mark a significant pivot from the expansion plan Foskett outlined twelve months ago, when he told The Times he aimed to increase the footprint to 150 stores, deepen the brand’s marketing reach and continue to build a special product range.
Growth Partner and Flooring Superstore had not responded to requests for comment at press time. Santander and Begbies Traynor declined to comment.
