LONDON — House of Fraser has gone offline following multiple complaints about failed deliveries of online orders. The department store has reportedly pulled the plug amid payment disputes with warehouse operator XPO Logistics.
On Wednesday, XPO Logistics, which runs two of HoF’s warehouses in Wellingborough, Northamptonshire, and Milton Keynes, Buckinghamshire, stopped processing orders after there were at least 50,000 unfulfilled online orders, according to British media.
A spokeswoman from XPO Logistics declined to comment Thursday on the company’s operating procedures with HoF.
It was reported that Mike Ashley, the owner of Sports Direct who bought HoF Aug. 10, is refusing to pay for goods and services prior to the takeover. Legally, Sports Direct does not have to pay any outstanding debts, as HoF had already gone into administration.
An industry source close to Sports Direct said that XPO Logistics’ reaction has hampered its rescue efforts for HoF.
The amount owed to XPO Logistics is estimated to reach millions of pounds, and the dispute has also reportedly involved the logistics company blocking a Sports Direct truck from picking up stock at the Milton Keynes site.
XPO Logistics is reportedly one of many thousands of suppliers that the retail chain owes money to at an estimated total of 60 million pounds. Retailers are reacting and withdrawing their stock from existing HoF stores including Jigsaw, Karen Millen and Whistles while negotiations are taking place.
Sports Direct in a statement claimed that efforts with suppliers have “begun to bear fruit.” It cited Massarella Catering as an example.
“I met with Mike Ashley and his team on Monday to clarify the implications. I can report that we had a positive meeting and have reached an agreement to continue trading all of our restaurants within House of Fraser,” Mark Massarella, managing director of Massarella Catering, said in the statement.
“I was impressed with Mike Ashley’s aspirations for House of Fraser, coupled with the level of funds that he is proposing to invest, which should breathe new life into many of the stores,” Masarella said.
The shutdown of HoF’s web site comes soon after Ashley earlier this week declared his new vision for HoF, hoping to turn the 169-year-old retail chain into “the Harrods of the high street” and to attract the likes of luxury brands Gucci and Prada.