Online furniture retailer Made.com has announced plans to cut more than 200 jobs and put itself up for sale, after supply chain problems and the cost-of-living crisis crippled its business.
The company has hired PwC to assess its options, including seeking emergency investment or a possible sale, as it reels from a slump in demand for its high-end goods.
Shares in Made, which sells velvet sofas, copper-framed beds and rose gold lamps, plunged by 30pc in morning trading to 3.6p before they recovered some ground.
The stock has lost 98pc of its value since its initial public offering 15 months ago, with the retailer now worth just £17.7m.
The business warned of job cuts in July as fewer households bought “big ticket” items such as sofas and dinner tables in the face of rising bills.
Market conditions have changed “radically” in the past year, the company added, and have torpedoed its plans to raise more funds from investors.
About 35pc of its 673 employees are expected to lose their jobs after chief executive Nicola Thompson warned of “unprecedented levels of market disruption and prolonged market volatility”.
Since its float, when it raised £90m from investors, Made has been spending on advertising campaigns and building up stock to deliver its wares to customers quicker.
But it has been forced to discount to sell more goods in the face of slipping demand, which has hit profit margins and cash position. It has also been hit by supply chain problems in the wake of the pandemic, which have left customers facing delays.
Made.com is consolidating its supply chain in Europe and Vietnam, closing its operations in China, and reducing its warehouse capacity because of lower levels of consumer demand.
The company, which warned on profits three times this year, said it hasn’t received any approaches so far and is not in discussions with any suitors at present.
“In order to extend the group’s cash runway further, the board has concluded that costs must be reduced further and a process has commenced to implement additional cost reductions, including a strategic headcount review, within the next few weeks,” Made.com said.
Sofa seller DFS last week also warned of a challenging outlook for the furniture sector, saying sales have fallen as demand wanes.