Scotch & Soda, a fashion retailer, has been saved from bankruptcy by Bluestar Alliance, a brand management company based in the United States.
While not all employees could be retained, the deal is a positive development for a significant number of Scotch & Soda employees. Prior to filing for bankruptcy for its Dutch operations, the company had approximately 800 employees in the Netherlands.
Scotch & Soda cited a series of events, including the COVID-19 pandemic, high inflation, and a drop in consumer confidence due to the war in Ukraine, energy crisis, and subsequent inflation rates, as the reasons for the severe cash flow issues that led to the bankruptcy filing.
The last lockdown in the Netherlands from December 2021 to January 2022 also had a significant impact on the business.
Despite recording record sales of 342.5 million euros in FY22, the company struggled with cash flow issues since June 2021, requiring ongoing support from lenders and shareholders.
The bankruptcy only affects its entities in the Netherlands, and its 32 stores in 21 Dutch cities remain open for the foreseeable future.
