Councils across Gloucestershire owed thousands by Body Shop after falling into administration

Body Shop owes thousands of pounds to councils across Gloucestershire after the retailer fell into administration. The cosmetics brand was forced to close nearly half of its 198 stores across the UK, including its store in Cirencester.

Stores in Cheltenham and Gloucester both remain open, but its new owners, private equity firm Aurelius, is trying to balance the books. According to Companies House, Body Shop owes money to 652 company creditors, with the total owed amounting to £44,626,414.43.

Among these funds, Cheltenham Borough Council is owed £1,548, Gloucester City Council is due £1,613, £1,445 is owed to Cotswold District Council and South Gloucestershire Council is owed £13,962.46. These outstanding payments are suspected of being business rates and councils are expected to contact administrators over how to clear these debts.

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Only one firm in Gloucestershire was a due payment from Body Shop, namely Payroll and HR solutions firm Zellis UK Limited. The Almonsbury business is owed £27,907.19.

In response to the outstanding debts, Cheltenham Borough Council is awaiting further information on how they can recoup the outstanding payments.

A spokeswoman for Cheltenham Borough Council said: “The appropriate claim for business rates outstanding at the time the company entered administration has been submitted to the administrators for the Body Shop. We are awaiting further information from the administrators regarding the availability of funds to clear outstanding debts.”

Gloucester City Council however clarified Body Shop no longer owed the local authority any further money. A statement reads: “The Body Shop is continuing to trade in Gloucester and their monthly Non-Domestic Rates charges is being paid by the administrators for the company which is standard practice in these situations.

“There was no money owed to the council at the time the company went into administration.”

The Body Shop is yet to repay more than £44m to creditors according to Companies House documents. Around 82 of the 197 UK stores have closed and 425 people lost their jobs, with a further 329 people being made redundant at the head office.

The Body Shop fell into administration in early February after previous forecasts for how much funding it would need to keep going proved too low.

The business had previously expected that its peak funding requirement would be £63 million, but it later had to revise this forecast to “in excess of £100 million”, a report sent from the administrators to creditors showed.

The Body Shop was founded by Dame Anita Roddick in 1976, trading out of a small shop in Brighton originally and made its name selling cruelty-free fairtrade products. However administrators said, in the late 1990s, the company was “no longer offering a distinctive product” at an “agreeable” price as other brands adopted similar policies and stricter laws came into force.

The company was sold to cosmetics giant L’Oreal in 2006 “who deviated from the core values that drove the brand’s earlier success,” FRP said. Natura bought the business in 2017 and “attempted to return … to its founding principles”.

The report added this effort was “ultimately unsuccessful” in getting consumers interested again.