LONDON — The Body Shop’s new private equity owners have placed the company into administration in the U.K., the birthplace of the brand and one of its largest markets.
Tony Wright, Geoff Rowley and Alastair Massey of the business advisory firm FRP confirmed they have been named joint administrators of the company that operates The Body Shop’s U.K. business.
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The administrators said The Body Shop will continue to trade as they look for a buyer of all or parts of the business. The Body Shop has around 200 stores in the U.K. and 2,568 employees.
This administration process relates to the U.K. business only, and does not impact the global head franchise partners.
FRP said The Body Shop had faced “an extended period of financial challenges under past owners, coinciding with a difficult trading environment for the wider retail sector.”
It is considering “all options to find a way forward for the business, and will update creditors and employees in due course.”
Filing for administration “provides the stability, flexibility and security to find the best means of securing the future of The Body Shop and revitalizing this iconic British brand,” FRP said.
The aim is to refashion The Body Shop into a company that can compete for the long term. “Creating a more nimble and financially stable U.K. business, is an important step in achieving this,” FRP argued.
The appointment of administrators comes at a difficult time for brands and retailers alike, which are dealing with a decline in consumer confidence, high inflation and soaring interest rates. The Body Shop isn’t the first — and won’t be the last — company in the U.K. to be placed into administration.
The failure of the U.K. business is of particular significance. The Body Shop was founded by Anita Roddick in the U.K. in 1976, and set a template for sustainable brands with “purpose.”
Roddick, with her opposition to animal testing and focus on sustainability in manufacturing and the supply chain, was one of the earliest U.K. entrepreneurs to prove that ethics and commerce could work in tandem.
Mark Constantine, an early Body Shop employee and cofounder and chief executive officer of Lush Cosmetics, wrote a tribute to Roddick, and the brand, in The Sunday Times of London on Feb. 11.
“No one can take away what was created at the company’s zenith. Without it, there wouldn’t be a Lush or B Corp today, and animal testing wouldn’t be on people’s minds. I would even go so far as to say it did more to change the world for the better than any other company since,” he wrote.
The Body Shop’s administration process is the result of a toxic combination of overexpansion and underinvestment by past owners, and fierce competition in the beauty market.
It is also part of a wider restructuring on the part of The Body Shop’s new private equity owners, Aurelius.
As reported earlier this month, The Body Shop has signed an agreement with an international family office to sell most of its business in mainland Europe and in parts of Asia.
Financial terms of the deal, which includes both physical and digital operations, were not disclosed.
The part of the activity affected equals to about 14 percent of The Body Shop’s business worldwide.
The sale does not impact its global head franchise partners, which operate on a country or territory level, but some sub-franchise partners are to be included in the sale.
The B Corp-certified company operates around 2,800 retail locations in more than 70 countries.
The impending divestiture is part of The Body Shop’s transformation after its acquisition by Aurelius Investment in mid-November 2023.
As previously reported, Natura & Co. sold the beauty retailer to Aurelius in a deal valuing The Body Shop at 207 million pounds.
In third-quarter 2023, The Body Shop’s sales reached 829 million Brazilian reals, or $168.6 million.
The company’s changing hands came a few months after a significant CEO switch at The Body Shop, when David Boynton abruptly stepped down.
He had been CEO since 2017, the same year Natura & Co. acquired The Body Shop from L’Oréal.
Boynton was succeeded by interim CEO Ian Bickley, who left the business in January, following the completion of The Body Shop’s sale.
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