This article is more than 1 year old

Watford Electronics left debts of £3.5m

Administrators hang on to stock

The figures also showed it had "identified" £105,141 of trade debt "not cleared in prior years".

Together with "write-offs", this meant a "total prior year adjustment" of £199,913.

Trade sources say that in the wake of these figures, credit insurers, led by Euler Trade Indemnity started cutting back Watford's insured cover carefully, so as not to frighten anyone into a rout. Euler refused to comment.

The whole channel was rooting for Watford, not the least because it would have been better for everyone if it had been able to trade out of its troubles and keep buying local stock to the tune of £50m.

Andrew Child, director of credit insurance broker Aon Trade Credit, said credit insurers were keen to do what they could for Watford.

"There were meetings discussed with [Watford's] directors. There was a decision to keep the company afloat," he said.

But the meetings, which were scheduled last week, were cancelled at the last minute without explanation.

After the collapse of names such as Tiny, Time (Granville), Elonex and now Watford, Britain's once hopeful PC industry has been crushed by competition from international behemoths.

The thing all these firms had in common said Sukh Rayat, European boss of components supplier Avnet, was that they were all having to compete with "the big guys."

He blamed the manufacturers of the components that go in the PCs for sucking up to the global PC makers and making a rod for their own back.

"The vendors let it happen," he said, "And now the vendors are in the corner as well because the tier ones have got the power. It's a real vicious circle."

The managing director of another PC components distributor said the thing the recent collapses all had in common was the poor relations they managed with their creditors - they crossed their fingers and hoped for the best when they saw the ship was going down instead of turning to their closest allies - their suppliers - for help.

"We work very well with particular companies that are working appropriately, but we tend to be aggressive in these situations - where there's more transparency we work with them," he said.

Computer 2000, which with around £450,000 unpaid is thought to be Watford's largest creditor, had been taking that approach until the surprise arrival of administrators, said Phil James, the distributor's commercial manager.

"I would say that there's still room for these guys, but it's a concerning time for them," he said of the British PC and consumer electronics retail sectors.®

More about


Send us news

Other stories you might like