Hotter Shoes, a struggling footwear retailer, is receiving a much-needed £2 million investment from its owner, Electra Private Equity. This investment comes after the approval of Hotter’s company voluntary agreement (CVA), which was supported by 99.5% of its creditors in July. The expiration of the challenge period means that Hotter can now proceed with its insolvency plan, allowing the company to make the necessary changes for its survival.

One of the key changes that Hotter aims to implement is accelerating its digital transformation. With a remarkable 11% growth in UK e-commerce sales during the first half of the year, Hotter recognizes the importance of prioritizing its online and direct-to-consumer channels over physical stores. Consequently, the company plans to close 46 stores, leaving only 15 open.

Electra Private Equity’s announcement of a £2 million investment demonstrates its commitment to supporting Hotter throughout the CVA process. The funds will be used to finance various strategic initiatives, with a focus on enhancing the brand’s product development capabilities.

In June, Electra had cautione that Hotter could face administration if it failed to secure backing for its CVA plan. Hotter had already been working towards a return to its direct marketing roots, but the Covid-19 pandemic and subsequent lockdown measures intensified the need for a more vigorous strategy.

With the injection of funds from Electra and the approval of the CVA, Hotter Shoes can now proceed with its restructuring plans and pivot towards establishing a stronger digital presence. As the retail industry continues to grapple with the effects of the ongoing pandemic, prioritizing online channels and investing in product development will be crucial for Hotter to adapt and thrive in the evolving market.

Connective links:
– For more information on company voluntary agreements (CVAs), visit Gov.uk.
– To learn about the impact of COVID-19 on the retail industry, check out this article by Retail Dive.