“It will be really difficult to defend the company when it does not have a customer,” said an insider. “This situation is really disappointing.”
The Edinburgh woolen mill itself is considered particularly vulnerable. The chain, which employs 7,000 people, is heavily dependent on deserted tourist spots and older customers who are not shopping online despite the pandemic.
Mr Day is investigating whether stores could be put on hold until buyers return, but such a decision would be difficult, requiring help from owners.
Sources close to Mr Day have said he may seek to retain the Edinburgh Woolen Mill brand through a potentially controversial “pre-pack” administration that would mean the closure of all stores and heavy losses for creditors.
Other EWM brands such as Austin Reed and Viyella could face the same fate.
Mr. Day is trying to get outside investments to save his stronger companies. He’s in talks with Davidson Kempner, a US fund that invests in struggling companies, to take a stake in Peacocks, which has 550 stores and specializes in inexpensive clothing.