It was a sad week for Workspace Office Solutions. After 75 years in business and a period as the UK’s leading office furniture manufacturer, the private Suffolk, Haverhill-based company – previously known as Project Office Furniture – was finally dissolved after going into administration in March.
Administrators Deloitte & Touche (D&T), who in March confirmed to OPI+ that it was "progressing" with parties that had expressed interest in parts of the remaining business, said that it had not been possible to sell the business as an ongoing concern. Only one division, Greenwood & Wood (G&W), was sold – to the subsidiary’s management.
D&T said in a statement: "Workspace Office Solutions has now ceased to trade from Haverhill. It has not been possible to sell the business as an ongoing concern and regrettably it has been necessary to make the majority of the workforce redundant. The company is retaining a few employees to assist the administrators with certain matters including the disposal of remaining assets. The outcome for the company’s creditors is uncertain as this will be subject to the future realisation of assets which will be completed over the next two to three months. All creditors will, however, be advised of the estimated outcome in due course."
Two hundred staff members have lost their jobs or have been handed redundancy notices. But D&T stated that staff members are "entitled to claim for monies due to them under the terms of their previous contracts of employment", adding that it is currently assisting employees by making sure their claims are prepared and submitted to the Department of Trade, which will make the payouts.
D&T’s statement continued: "The administrators are disappointed that it was not possible to sell this established business as an ongoing concern, particularly given the support of the employees, customers and suppliers during the short period that the company traded in administration, and its priority is now to maximise the realisation of assets for all creditors."
In contrast, the management of G&W remain confidently upbeat for the future following their split. John Robinson and Tony Sellers, managing director and sales director of the division – a designer and manufacturer of specialist furniture for the UK’s leading financial institutions and blue chips for over 30 years – originally made an offer for the business two years ago, which was declined. So when they were approached by Workspace management to see if they were interested in buying the business in March, they jumped at the chance. "We are very happy about the situation," Robinson told OPI+. "It’s a scary time financially because it’s just down to us and we are just about breaking even. But we are very positive about the future."
Robinson hopes that G&W, which has kept all 80 staff members, will thrive as an independent entity. "We have always had a very different culture to Workspace," he said. "Workspace was focused on operating efficiencies, demand control and product codes; we are focused on developing intimate trading relationships with our customers. Workspace was based on standard costings; we run on leaner accounting principles. We have also received a tremendous amount of support from our customers.
"There’s lots of uncertainty and doubt in the industry but we feel positive we can become the supplier of choice for bespoke products made through a variety of materials and manufacturing processes," he added. "We also aspire to become the specialist manufacturer for other suppliers of office furniture. We are aiming to double our turnover in three years."
Founded in 1931, Workspace, formerly Project Office Furniture, was once the UK’s leading office furniture manufacturer with a workforce of over 1,000. In the summer of 2004 Haverhill-based Project merged with Ripley, Derbyshire-based Pentos and took on the new name of Workspace Office Solutions. The newly-merged company owned a handful of systems furniture brands including Project, Asher and Elect and had two panel processing plants – one in Haverhill and one in Ripley.
Since Workspace went into administration, these brands have been sold. The Project brand has been bought by OEP Furniture Group, which has taken on a number of Project sales employees and amalgamated the brand into its own supply chain, which manufactures in Eastern Europe. The Asher and Elect brands have been acquired by competitors and look likely to be removed from the market. Solutions At Work, Workspace’s distribution business, meanwhile, has received no interest from buyers – most likely because it is underpinned by Workspace’s own products.
So where did it all go wrong for Workspace? While the company’s management offered no comment, G&W’s Robinson claimed it was as a result of the merger between Pentos and Project in 2004. The companies were already starting to struggle in an increasingly competitive market and had very different cultures. "The merger didn’t work," said Robinson. "Each company had a different culture, a range of different products and Workspace never achieved the admin savings it thought it would achieve."
The death knell he claimed was sounded a few months ago when the company, which was by then operating at a loss, was forced to ask investors to inject some equity. When the individual divisions prepared capital forecasts that stated how much capital was required, it was the end of the road for Workspace. Another lesson, another goodbye.