Woolworths to start closing down sale

Closing down sales at Woolworths stores will start today and some shops could shut before the end of the month if no offers for the troubled British sweets-to-DVDs retail chain emerge, its administrators said.

The closing down sales add to uncertainty for the 25,000 staff at the 815-store retail chain, as well as to disruption for rivals such as HMV and WH Smith during the key Christmas trading period.

"While we are still seeking bids from interested parties, Christmas is clearly the busiest time of the year for retailers and it is prudent to do all we can to sell existing stock," administrators Deloitte said in a statement yesterday.

"By moving to a store closing sale and further discounting the stock, we are maximising the sales potential that this period offers."

Deloitte added that if no offers for the Woolworths business were forthcoming, then it was possible that some stores might close before the end of December.

Woolworths, which sells more sweets than any other British retailer and has top five positions in toys, children's clothing, homewares and entertainment products, is the biggest UK casualty so far of a brutal downturn in consumer spending.

Researchers Experian said earlier this month that over 1,000 non-food retail businesses had failed over the previous 12 months, with the number accelerating in recent months as shoppers cut spending amid fears of recession and unemployment. Woolworths, which had been squeezed for years by competition from supermarkets, online retailers and specialist groups, put its retail chain and EUK distribution business into administration, a form of creditor protection, on November 27.

Supermarkets including Tesco, Asda and J Sainsbury, and rivals such as privately-owned Wilkinsons, have said they might be interested in a few Woolworths stores, but not the whole retail chain.

Iranian property magnate Ardeshir Naghshineh has also said he is keen to salvage the business, while newspapers have cited frozen food retailer Iceland, restructuring specialist David Buchler, retail veteran Geoff Mulcahy, and the chain's own management team led by Tony Page as potential rescuers of at least part of the business.