2024-09-14 16:47:28
In the spring, the British cosmetics retailer Body Shop went bankrupt. But one investor even sees growth potential for Germany.
After the takeover of the insolvent cosmetics retailer The Body Shop in Great Britain by an investor, there is also a solution for German branches. The entrepreneur Stefan Herzberg will take over 21 of the former 45 German branches on September 15, as he announced on Friday in his profile on the career portal Linkedin. The magazine “Wirtschaftswoche” had previously reported. In addition, there are six branches that are operated by third parties on their own account, as insolvency administrator Biner Bähr announced. In total, 182 jobs were retained in Germany as a result.
The cosmetics company filed for bankruptcy for its UK branch in mid-February and shortly thereafter for its German branch. The Body Shop brand was established in 1976 and was one of the first companies to focus on ethically produced cosmetics and skin care products.
“Now that The Body Shop has a new owner in Great Britain, we have been able to conclude a long-term franchise agreement,” investor Herzberg told the magazine. “There is much to suggest that The Body Shop will grow again in Germany.” In the medium term, he could imagine opening new branches and possibly even expanding into other countries. Before setting up his own business, Herzberg was a manager at Christ, Karstadt and GE Healthcare, among others.
Regarding the reasons for the insolvency, insolvency administrator Bähr told “Wirtschaftwoche” that the German Body Shop company had paid rents for some locations “that were not economically justifiable.” The excessive rent burden was – as is often the case in retail – one of the main problems. In the course of the insolvency, he negotiated with the landlords. But not all of them were willing to compromise. “We had to close these locations.”
According to the Falkensteg management consultancy, the sale of the retailer remains an exception this year. From January to the end of August, 595 retailers had to file for bankruptcy – around six percent more than in the same period last year. But in the retail sector in particular, only a few companies were given a second chance. The rescue rate for insolvent retail companies with a turnover of more than 10 million euros is only 43 percent.
“The previous model of covering the market with shops is now being replaced by mixed concepts with online shops and selected areas,” explained Falkensteg partner Georg von Verschuer in a statement. There will only be branches at selected locations in prime locations in medium-sized and large cities. Falkensteg says it has organized the sale process of the Body Shop German business on behalf of the insolvency administrator.