Woolworths' vouchers worthless

[Kwackerz]

Shoppers have been left with more than £10 million of gift vouchers that are impossible to spend, due to the collapse of high street chain Woolworths.

By Rosie Murray-West, Deputy Personal Finance Editor
Last Updated: 6:12PM GMT 18 Dec 2008

The vouchers, which were issued by a subsidiary of Woolworths Plc called Flogistics, could be spent in Woolworths, B&Q and Comet. Many of them were issued as loyalty bonuses or rewards for employees, who will have saved them up for Christmas spending.

However, sources close to Woolworths confirmed that the vouchers were no longer being accepted in Woolworths stores, which are now in administration and expected to close soon after Christmas.

Both B&Q and Comet said that their stores would not accept the vouchers - which are known as Kingfisher Vouchers.

"We are advising anyone in possession of such vouchers to return them to the company who issued them," said a spokesman for B&Q.

A spokesman for Comet said that "in light of recent developments regarding Woolworths, Comet is currently not accepting Kingfisher Gift Vouchers as the voucher scheme is run by the Woolworths business".

Administrators for Woolworths said that the company was still accepting gift vouchers that were sold in its own stores and valid only at Woolworths. However the stores are also not accepting the Kingfisher vouchers, because the Kingfisher scheme was run by a different part of the Woolworths business that is not in administration.

Sources close to the voucher scheme estimated that customers could be stuck with unspent vouchers worth "in the low teens of millions".

A spokesman for Deloitte & Touche, the administrator for the Woolworths stores, said that customers with Kingfisher vouchers would not be able to spend them in the store. However, he urged customers with unspent Woolworths-only vouchers to spend them as soon as possible.

"If you do not spend them, and the stores close, you will become an unsecured creditor," he warned. Woolworths Plc, the still-trading arm of Woolworths, declined to comment.

[Viking]

Typical. The store receives the money from someone buying a gift voucher and then reneges on honouring the gift voucher. Smells like 'theft' to me.

[Syltiz]

Its down to simple creditor ranking. Secured and Preferred creditors (government, employees etc) get paid first and if there is anything left in the pot after that then unsecured creditors get something. As the holder of a voucher is an unsecured creditor its unlikely they will get anything given the amount of debt Woolworths was in.

Retail in this country is still in for a few more shocks I reckon.... the retail industry in the UK is way behind other 1st-world countries in terms of service and cost-efficiency.