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Gloucestershire Business News

House of Fraser cancels online orders

If it looked like all was well with House of Fraser after it was saved from administration at the last minute  by Mike Ashley of Sports Direct last week, it seems there are still a fair few problems behind the scenes.

The department store chain has cancelled all of its customers' online orders, as reported by Retail Gazette.

In this latest development, the company has informed customers that it has cancelled online orders due to significant delays. The announcement comes just two days after the retailer tweeted that deliveries would be made "as soon as possible".

A dispute over payments with the businesses' distribution centre XPO Logistics has led to XPO refusing to accept goods or process deliveries for the chain, which has a store in Cirencester and Cavendish House in Cheltenham.

It's thought that XPO has called for Mike Ashley to honour the contract terms it held with its previous owner. House of Fraser's concessionaires and suppliers are collectively owed at least £70 million in payments relating to sales in June and July. But House of Fraser administrator EY said the amounts owed will not be paid.

XPO could currently be owed tens of millions of pounds, but under the pre-pack administration deal in which House of Fraser was acquired, the purchases are able to discard existing pension liabilities and creditor claims.

So House of Fraser has now contacted shoppers to say they will be cancelling and refunding all orders that have not already been sent out to customers.

The retailer said it didn't take the decision lightly, but felt it was the best option as it couldn't give customers a clear idea on when their orders would be delivered.

What do you think? Is House of Fraser out of the woods yet? Email mark@moosemarketingandpr.co.uk 

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