Administrators have today announced that the international eCommerce stores for Wiggle and Chain Reaction Cycles will be switched off.
In a move that will see the WiggleCRC business "focus its efforts solely on the UK market," the Joint Administrators in charge of the group have revealed that the transition will take place "over the coming weeks."
It comes as the group, which entered administration in October, continues its search for a buyer.
Alastair Massey and Tony Wright of specialist business advisory firm FRP, were appointed to parent companies Mapil Midco 1 Limited and Wiggle Limited on October 24. At the same time, practitioners from the same firm were appointed to sister companies Chain Reaction Cycles Limited, Chain Reaction Cycles Retail Limited and Hotlines Europe Limited.
That all came as a result of the collective group's parent company, Signa Sports United NV, being plunged into difficulty by its own majority shareholder, Signa Holdings, which reneged on €150m of committed funding just months into a longstanding agreed deal.
In today's statement from the Joint Administrators seen by Cyclingnews, it is revealed that the UK market accounts for 85% of the WiggleCRC group's revenue, and a decision has been made to focus on this core.
"To ensure that WiggleCRC is in the best possible position to build on its core strengths and market leading position, the decision has been taken to pivot the business model to solely focus on the UK domestic market," it read. "The international Wiggle and Chain Reaction web shops will therefore be closed over the coming weeks."
Delivery to the UK will remain available from both stores.
The statement adds that the international part of the business has been impacted by "a range of economic factors" including Brexit and rising air freight costs.
Tony Wright, one of the administrators in charge, said: “The UK market is core to WiggleCRC’s proposition where it remains the market leader and is a powerful driver for the business' profitability and current trading performance."
He also revealed that the process to sell the business is gathering pace and that there are ongoing talks with multiple parties, stating that the UK proposition of the business "has been incredibly attractive to interested parties and we are progressing swiftly with the sale process.”
Previously, both Wiggle and Chain Reaction Cycles had shipped to dozens of countries across the world, including as far away as Australia. Since the administration proceedings began, a statement on both websites has promised business as usual.
That is evidently set to change, but existing customers and those with open orders are reassured that the group will be honouring "all outstanding sales, returns and warranty obligations for international customers."
