E Point Perfect

Ted Baker cashflow under pressure as it trades without credit insurance


Ted Baker
// Ted Baker’s cashflow has been put under stress as it has been trading without credit insurance for the past two years
// Big insurers such as Euler Hermes and Atradius are understood to have cut cover for the retailer’s suppliers at the height of the pandemic and have not reinstated it

Ted Baker’s cashflow is under pressure as the fashion retailer has been trading without credit insurance since the height of the pandemic.

The Sunday Times reported that big insurers such as Euler Hermes and Atradius cut cover for Ted Baker’s suppliers back in 2020.

The struggling fashion retailer, which is currently up for sale, was left with just £3.1 million in net cash as of January as it bankrolled more stock in anticipation of a bounce back in sales following Covid restrictions being lifted.

READ MORE: Ted Baker sales grow but cautions on inflation

Credit insurance protects suppliers against the risk of a retailer collapsing in the period before a payment is made for an order. Without it, suppliers seek tighter payment terms, which can place a strain on a retailer’s cash flow

Ted Baker is currently amid a sale process, advised by Evercore and Blackdown Partners. However, last month the sale was thrown into doubt as frontrunner to buy the retailer, Reebok-owner Authentic Brands Group pulled out of takeover talks.

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