Poundland sales are reportedly surging, even as the discount retailer’s owners move towards appointing administrators.
Investment firm Gordon Brothers, which took control of Poundland last year, has already closed more than 100 stores and two warehouses across South Yorkshire and the Midlands.
As many as 12,000 jobs may now be threatened after the budget chain approached the High Court on Thursday with notice of its intention to enter administration.
Poundland has ten days to secure a buyer. However, Gordon Brothers has come under fire after turning down a proposed takeover by Martin Property Group.
In a statement, Poundland indicated that the business could instead be split up and sold in parts. The retailer said it had received formal proposals from “several established retail operators” covering a “significant part of the business”.
The development comes despite a recent improvement in trading, with bosses describing the chain as having returned to profitability, according to The Times.
A message sent to suppliers and seen by the newspaper showed that sales climbed 8.4 per cent in the three weeks to October 18.
Sales, margins and gross profits were reportedly “running comfortably ahead of expectations”, while one source said the business was “flying”.
Poundland sales are reportedly soaring despite its owners filing a notice of intention to appoint administrators
Gordon Brothers is facing mounting scrutiny over its decision not to accept the rescue offer from Martin Group. Unions have accused the investment firm of being “determined” to allow Poundland to descend into disarray.
Negotiations broke down after Gordon Brothers insisted that the prospective buyer take on a £30 million loan inherited when the firm acquired Poundland for a nominal £1 in June 2025.
Business Secretary Jonathan Reynolds has called on Gordon Brothers to explain its decision. Speaking to the BBC, he said: “If there is a potential owner that can continue that progress, obviously that naturally sounds like the best way forward. So if that hasn’t been accepted, I want to know why that is the case.”
Poundland founder Steve Smith, who launched the business in 1990, has also criticised its current owners, accusing them of being “greedy” in a statement issued this weekend.
Mr Smith warned that a collapse could result in the loss of as many as 30,000 jobs across the wider supply chain and related businesses.
“If Gordon Brothers are being greedy then it is going to cost thousands of jobs, in the newspapers it says 12,000 jobs are at risk. My estimate is more like 30,000 jobs,” he wrote in a lengthy LinkedIn post.
“It is not just the people that work for Poundland it is also their suppliers they have thousands of suppliers, some that just serve them, therefore these suppliers will suffer or be at risk of going into administration.”
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He added that taxpayers could ultimately bear the cost of supporting thousands of unemployed workers if Poundland enters administration, while liquidators would “make a lot of money”.
Mr Smith also said he had tried “several times” to contact the current owners, but claimed they had “never returned my call”.
If Poundland fails, it would be one of the biggest high street collapses since Debenhams shut its stores in 2021. The department store chain’s closure resulted in the loss of about 12,000 jobs.
The Prime Minister, whose Makerfield constituency includes a Poundland distribution centre where 270 jobs could be affected, said last month that protecting employment was a priority when questioned about the retailer’s future.
‘We want to see jobs protected. If there was a potential owner to avoid this that hasn’t been accepted, then the Business Secretary [Jonathan Reynolds] and I want to know why that is the case,’ said Andy Burnham.
In a social media post, Reform’s Robert Jenrick claimed that should the company collapse it would be an example of ‘crony capitalism’.
He said: ‘People have attacked me for taking up this fight, saying: “Businesses go under all the time, that’s just the free market”.
‘Sure, but this is crony capitalism and the 12,000 workers deserve better.’
Poundland has struggled in recent years after ‘straying from the single £1 price point that defined its core identity’ and expanding into selling clothes and frozen food, said retail expert Jonathan De Mello.
Retailers are also battling higher costs, following Government moves to hike wages and employer National Insurance contributions, while shoppers have been lured in by online giants Amazon and Temu.
Other firms thought to be hoping to buy shops include rival Poundstretcher, which is owned by US investment group Fortress, and retailers including Iceland and Lidl.
CDS Superstores, the group behind The Range, Homebase and Wilko, is also thought to be interested. The group is owned by Chris Dawson, known as Britain’s ‘Del Boy Billionaire’.
Modella Capital, which bought WH Smith on the High Street and rebranded under TG Jones, has also been rumoured to be involved in talks.
Bally Auluk, national officer for the Union of Shop, Distributive and Allied Workers, said this week has been ‘incredibly distressing’ for Poundland staff and accused Gordon Brothers of attempting to ‘jeopardise their livelihoods’.
He urged its owners to ‘reconsider and to prioritise a unified buyer’.
The Daily Mail has approached Gordon Brothers and Pepco for a comment.
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