The coompany behind Time and Tiny Computers, two of the biggest computer brands in the UK looks set to fall into administration amid reports of a financial crisis at the firm. Reports on the BBC web site claim the company has already gone under, and that Grant Thornton has been appointed as administrator of the remaining assets.
Granville Technology Group, the parent company of Time and Tiny, makes 500,000 computers a year, many of which are sold into education as well as to consumers. Yesterday the company shut down its entire 78 store high street retail operation (its stores are branded as The Computer Shop), with official statements from the company and notices on shop shutters claiming that the closure was in part to allow staff to conduct an annual stock take, while at the same time allowing the company to negotiate the reinstatement of its credit card merchant facilities, which were withdrawn yesterday by its banker HSBC folloing the failure of Granville to repay a loan. GE Capital, which provided financing for customers buying their PCs on installment plans are also believed to be owed a considerable amount.
However, staff who have spoken to the media have confirmed that they are not stock taking, and have been told to go home and await further information. Today, staff at Time’s Burnley assembly plant were beginning to receive redundancy notices. The entire board of directors, except its part-time chairman, have also resigned en-masse in the face of the failure of the business.
Granville, which employs 1,100 workers, was due to file accounts with Companies House in April but has failed to do so, which is usually a good indicator of a company in deep trouble. The company is believed to have net liabilities of about £50m.
There are an estimated 2m Time and Tiny PCs and laptops in UK homes abd classrooms. Time PCs are also sold through Tesco, Asda and Woolworths, while Tiny computers are sold exclusively online and via mail order adverts in magazines and newspapers. Around 500,000 computers sold by the company are believed to still be subject to outstanding warranties and service contracts. It is unclear at this stage whether the company has insurance to cover these liabilities.
Granville Technology Group has had problems in the past. A previous over-ambitious retail expansion pla’n put pressure on the group’s finances, and the company has a notoriously bad record for poor customer service and unreliable, low quality product. The current woes come three years after the company, acquired Tiny Computers out of administration. Tiny went bust in 2002 with debts of more than £35m.
The failure of the group appears to stem from continued price deflation in the PC market, with larger international rivals such as Dell, HP and Apple continuing to drive prices and profit margins down in an attempt to win market share.