Missguided shoppers have been told they will not be able to receive refunds after the company fell into the hands of administrators.
Teneo, who was hired by Manchester-based Missguided to run the administration process, has informed existing customers it will not be able to honor refunds as part of the insolvency process.
Mike Ashley’s Frasers Group agreed to buy Missguided earlier this month in a deal worth around £20million, but the sale is only expected to complete in August. Missguided has now stopped taking orders, ahead of its sale to Frasers.
Refund debacle: Missguided shoppers have been told they will not be able to receive refunds
One customer said on Twitter that she was ‘freaking out’ after being told she would not be refunded.
She shared a text from administrators at Teneo which read: ‘We will not be able to honor any pre-appointment refunds requested and not yet settled.
‘In this case, you can make a claim in the administration process.’
Another affected customer took to Twitter and said: ‘Totally unacceptable that you are not issuing refunds to customers! I have already sent the item back to you so not only do I not have the item I don’t have the refund either.’
Savings comparison site Raisin UK spoke to another affected customer, Natasha, a masters student from Hertfordshire, who said: ‘I ordered on the 14 April with around £70 worth of products.
‘I’m just very confused because they received my parcel back around two weeks ago, but I haven’t heard anything and I also can’t access my account as the website is down, so I have no idea if there’s any progression in my refund!’
Typically, customers are often among the last on the list of creditors to receive repayments if a company goes bust.
This is Money has asked Teneo for comment.
At the time of writing today, Missguided’s website was down for maintenance. A message on its website said: ‘Our maintenance pixies are currently working their magic on the site.
‘We’ll be back with you soon, in the meantime check out our blog or get help on an existing order through our customer care team…’
Revelations about the status of customer returns came just a day after Frasers confirmed that it will rehire Missguided founder Nitin Passi to become the company’s chief executive once the takeover it completed.
Passi left the business in April as the group sought a new owner.
Missguided and its menswear arm Mennace collapsed in May, after its suppliers filed to shut it down over unpaid debts.
Many online fashion retailers fared well in the early stages of the pandemic, but have started to struggle amid the axing of lockdown restrictions, higher costs and inflation taking its toll on shopper budgets.
Fast-fashion businesses like Missguided also faced fierce competition from online rivals like Asos and Boohoo.
Annelie Helgelin, from digital consumer intelligence group Brandwatch, said Missguided had been heavily criticized on social media in light of the refunds debacle.
Negative mentions on Twitter were up by 1,451 per cent and positive posts down by 30 per cent since 26 May when it was on the verge of collapse, with a lot of the ‘angry mentions’ from customers frustrated over missing refunds and deliveries.
‘It can be challenging for a brand to reclaim its loyal following after an incident like this, where many customers feel let down’, Helgelin told the BBC.
Kevin Mountford, co-founder and savings expert at Raisin UK, told This is Money: ‘Missguided collapsed due to unpaid contracts with suppliers, and sadly during administrations, customers are the last on the list for repayment.
‘We’ve been talking to Missguided customers last week, and we were seeing emails that Teneo was not going to be processing refunds straight away and that customers should email their cases, but the warning was clear that customers are unlikely to receive their refunds.
‘So whilst there were celebrations that a buyer had been found for Missguided, we are far from business as usual and there is no clear answer for when the website, or support portal, will reopen.
‘It’s also clear that the debts Missguided have, far exceeded the value of their assets and that administrators will prioritize suppliers and most likely have little left, maybe even nothing, to refund customers.’
A spokesperson for Begbies Traynor, said: ‘This morning’s announcement, from the Administrators of Missguided, will not come as a shock to many but it won’t sit well with the many customers who will no longer receive refunds for their returns.’
Tobias Buxhoidt, chief executive of parcelLab told This is Money: ‘The news that Missguided is not offering customers their money back on returned items highlights an error of judgment for the retailer that could be costly for the business in the long term. For their customers, this could be interpreted as not prioritizing customer loyalty now, or in the future.
‘For a company that will be reforming itself whilst looking to maintain an once loyal customer base, this is an error.’
What can affected Missguided shoppers do?
Although Teneo has said refunds will not be issued to Missguided customers, there are a number of steps affected shoppers can take to try and ensure they get their money back. How you get your money back will depend on how you paid for the item.
All affected customers should, as a first point of call, consider contacting Teneo in writing and state exactly what they owe and what for.
Buy now, pay later purchases
Kevin Mountford, co-founder and savings expert at Raisin UK, said ‘Firstly, if you paid via a Buy Now, Pay Later platform, you should continue to pay off any amounts that you owe. Your “debt” is handled by your lender which is the Buy Now, Pay Later platform and not Missguided.’
Credit card purchases over £100
Options: Missguided customers who spent over £100 using a credit card can try and get their money back via a Section 75 claim
Mountford said: ‘Under Section 75 of the Consumer Credit Act, if a customer paid for something costing between £100 and £30,000 on a credit card, the card firm’s equally liable if something goes wrong with your order, so you may be able to claim your money back for any missing orders or refunds.’
Debit card purchases – or credit card purchases under £100
For customers who used a debit card to pay for their products, or spent under £100 using their credit card, Mountford said: ‘If you paid by debit card, or your purchase was under £100, you can also chargeback with your bank to try to get any money back from missing orders and refunds.
‘But, it’s incredibly important to note that a chargeback is not a legal requirement and is just a customer service promise where your bank will request the money back from Missguided.
‘It’s also incredibly important to mention that chargebacks can be disputed, and Missguided may take that money back from your account.’
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