THE BOSS of failing Croydon Village Outlet says Croydon Council and inadequate staff have been partly to blame for the town-centre store making a loss of more than £1 million since it opened in September.
In a statement provided to the High Court – and seen by the Advertiser - Marco Cash also suggests the aged building and even cold weather helped push Metro Outlet Croydon Ltd into administration last week. The store, in North End, is trading as normal while administrators seek a buyer.
Mr Cash added he was renting the former Allders building at a vastly reduced rate, but was soon struggling financially after a "significant run of bad luck."
The salesman, who built up a chain of knitwear shops in Belgium in the 1980s, opened the bargain department store to replace Allders seven months ago, pledging it would become the "Harrods of the South-East."
But last week he asked the High Court to put the company into administration, saying it was "unable to pays its debts" – although he disputes some of what others say he owes them. The company employs more than 120 people,
In his witness statement to the High Court, seen by the Advertiser, he added: "The purpose of the administration would be to realise property in order to make a distribution to one or more secured preferential creditors.
"I believe that if the Company were placed into administration, this purpose is reasonably likely to be achieved."
Mr Cash told the court how the venture had gone from a "very feasible" business proposition to making a "significant loss of around £1.1 million."
He said he and co-director Joanne Morrison planned to run the store with about a third fewer direct employees than Allders, which had closed in September 2012 after going into administration and failing to find a buyer.
He added Allders had been paying more than £2million-per-year in rent while his company would be paying £8,000-a-week (less than £500,000 a year), to trade from and rent out space to other concessions.
He said the leader of Croydon Council at the time, Jon Rouse, had promised "all the help he could," including rates relief and part of the money the Mayor of London had given Croydon to help it recover after the August 2011 riots.
But offers of financial help were "withdrawn" after the Westfield/Hammerson redevelopment of the building and the Whitgift centre was granted planning permission in February 2014, he claimed.
He told the court: "This [Westfield] development is being favoured by Croydon Council, as a result of which any financial assistance that was offered previously has been withdrawn.
"The Company has tried on numerous occasions to obtain aid from Croydon Council but to no avail."
Mr Cash added the store's disastrous opening day in September 2013, in which it was forced to close due to the till system's failing, "essentially ruined" £50,000 invested in the launch.
His co-director Ms Morrison then relapsed into illness after suffering from a brain tumour before starting with the company, he added.
The store also suffered from above average shoplifting levels, negative reports in the local press, and the human resources manager's leaving after recruiting staff not up to their jobs, he said.
Bills of around £100,000 to repair the escalator and lift, and replacing flooring damaged when the building was closed "and due to cold weather," made things worse, he continued.
Mr Cash pumped his own cash into the venture and borrowed privately, but financial problems only deepened.
Two suppliers made winding-up petitions in March against the company, neither of which had been heard before it went into administration. Two county court judgements have been granted against it.
Mr Cash told the High Court he disputed both winding-up petitions, saying Rectella Ltd, of Manchester, had been paid everything owed.
He said the sum of £38,097.92 asked for by HILCO Wholesale Limited, of Middlesborough, was in dispute and going down daily as HILCO is trading at the store.
A county court ruled his company does owe £9010 to Alegrata Limited, for a security tagging system fitted in the store.
Metro Outlet Croydon Ltd is now under its appointed administrators, Andrew Andronikou and Peter Kubik, of UHY Hacker Young LLP, who hope to have a new buyer in place by Tuesday or Wednesday.
Mr Andronikou told the Advertiser on Thursday: "We are looking for a buyer and to preserve as many jobs on site as possible.
"We are trading as normal and a number of the concessions are trading independently of us."
