Mike: JAG’s near-collapse

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A year ago, JAG was by some way the biggest retailer in the regions, and was pushing its claims as a third national chain with the purchase of 57 Midlands outlets from Go Mobile.

It seemed John George’s ambitions to ape Carphone, or sell to it, were closer being realised than ever.

Six months later, cracks appeared as the deal with Go Mobile collapsed.

Either George was misled on the new stores’ performances, or he just could not cope with such reach.

Now, JAG’s £2.3 million overdraft has been withdrawn by Lloyds bank, leaving George to dip into his own pockets and the chain little trading flexibility.

Suddenly, JAG looks more likely to follow The Link off the high street, than Carphone up it.

Parochial London chain Fonehouse and Welsh chain Get Connected look like even catching it. It shows the delicate situations much of the SME market finds itself in.

For Lloyds is not the only bank presently considering how worthy its customers are of pre-recession banking privileges.

JAG’s borrowing and expansionist dream were products of former, blind economic positivity. Shrewdness and parsimony are the way to succeed in this market.

 

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