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SINGAPORE: Days after Robinsons department store announced it would close its last two outlets in Singapore, some vendors said the 162-year-old retailer owes them thousands of dollars.
These suppliers sell their products on consignment, where they are paid only after the goods are sold to customers.
Vera Ong, owner of the Lovera Collections dinnerware store, said Robinsons owes her company about S $ 6,400 for sales between August and October.
When he asked Robinsons if he could pick up his unsold stock at The Heeren’s branch of the department store, staff members told him no and that he would need approval from the KordaMentha liquidators.
However, repeated emails and calls to KordaMentha director Hamish Bull went unanswered, he said.
It was only when Ms. Ong appeared at The Heeren with her baby in tow that she realized that the liquidators were there and could approve such claims in person.
“Adequate communication was not sent to suppliers on how to (claim) their stock. To this day, we have other providers who send us messages to ask us how to withdraw ours, “he told CNA.
READ: Robinsons to close last 2 stores in Singapore due to weak demand
In a Facebook post, KordaMentha said vendors must provide evidence that stocks are being held on consignment before returning the collection. This could be in the form of a shipping agreement with Robinsons or copies of purchase orders or invoices.
Lovera Collections is also owed about S $ 3,000 from honestbee, which was issued a liquidation order by the Superior Court in July of this year.
Dawn Bey, owner of Pew Pew Patches, which sells embroidered iron on patches and stickers, said she is owed more than S $ 1,000 for August and September.
Since then, he has withdrawn his remaining shares, worth about S $ 8,000, from Robinsons.
Even though Robinsons closed her Jem store in August, the 30-year-old said she did not expect the other stores to close as well.
“I’m not sure what will happen to the outstanding payments, but from the experience with Gallery & Co, I doubt they will pay us,” she said, referring to the store at the National Gallery Singapore where her company also had consignment. values.
Gallery & Co announced its liquidation in August this year.
READ: Robinsons customers are in limbo for unfulfilled orders while suppliers await payments
The proceeds are likely to be used to pay other Robinsons obligations, Bey said.
“Suppliers are one of the last on the list, so essentially we put our inventory there to sell, but to pay everyone else. It is a great loss for us. “
A spokesman for bedding supplier Intero Enterprises, who declined to be named, said it had previously gone through the liquidation of stores such as Yaohan and Oriental Emporium, while working with other employers in the past.
Then the liquidators had arranged meetings with creditors to inform them of what to expect, before the company formally announced its closure, he said.
In contrast, vendors had no idea something was wrong with the Robinsons, he said, noting that they had been told to prepare for Black Friday, Christmas and Chinese New Year sales through mid-October.
By comparison, he described the situation with Robinsons as “disorganized.”
“The owner cannot just push the thing to the liquidator and expect the liquidator to take care of everything. There must be some responsibilities that the owner must take on, ”he said, adding that he hopes authorities can intervene to help suppliers caught in such situations.
He said that KordaMentha had informed him that a meeting of creditors would be held no later than November 27.
File photo of Robinsons at Jem Mall.
“YOU SHOULD NOT EXPECT TO BE PAID THE FULL PAYMENT”
When contacted by CNA, a Robinsons spokesperson said: “With respect to all transaction inquiries such as refunds and deposits, we understand the concerns raised by stakeholders and are confident that the KordaMentha team is doing their best and will handle the matter quickly. ”
CNA has contacted KordaMentha for more information.
The liquidator had previously told the media that vendors would be paid for any sales made from Friday (October 30) onward, and that he was evaluating options to “preserve the value of Robinsons assets and maximize returns. for creditors. “
However, the chances of providers receiving full payment are slim, the lawyers said.
WATCH: ‘My Favorite Store’ – Fans Rush to 2 Robinsons Outlets After Announcement of Closure
“Since providers are unsecured creditors, they generally rank last in the hierarchical order of claimants. Therefore, the possibility of receiving their outstanding payments would be below average and they should not have the full payment, ”said Farallon Law Corporation managing director Nicolas Tang.
Steven Lam, director of Templars Law, said providers would normally have to file proof of debt with liquidators, as is the case with Robinsons.
“In extreme cases, they might consider asking the liquidators to investigate the actions of the directors and officers of the company to see if there is a possibility of illicit trade or even conspiracy,” added Mr. Lam.
“None of Robinson’s vendors will be able to sue for outstanding payments during the settlement process, when the court would not allow any legal action against Robinsons,” Tang said, noting that this is to prevent further deterioration of Robinsons’ financial condition. position.
READ: Do department stores still have a future in Singapore?
While working on consignment puts small and medium-sized enterprises (SMEs) at a disadvantage in such situations, Ms Bey said she would continue to do so as this is the “only model that exists in Singapore at this time”.
“It’s rare to find someone who wants to buy from you in bulk, especially since it’s a local brand and you can easily reduce stocks when needed,” he said.
“Small businesses have no choice but to adopt this model to extend their reach to different audiences. They are too small to pay rent for a store, “he added.
“So sadly, we have no choice but to continue working with this model. Perhaps the government should review the laws to protect SMEs, especially during liquidation, as there are so many these days.
