The Body Shop’s bankruptcy: Suppliers left shortchanged by partial payouts

The Body Shop’s administrator at FRP Advisory has announced that the beauty retailer will pay back only part of the money it owes after going bankrupt last year. Unsecured creditors, including suppliers, landlords, and charities will reportedly receive between 16% and 27% of the £219 million (US$283.4 million) owed.

The company will reportedly fully reimburse tax authorities, and employees will receive any holiday pay owed. However, reports suggest most other creditors will only receive a small share of their money.

The Body Shop collapsed in February 2024, three months after private equity firm Aurelius acquired it. A few months later, a new owner — Mike Jatania’s Auréa Group — bought the UK business for around £44.3 million (US$57.3 million). The deal saved 113 stores and 1,300 jobs.

Before the collapse, The Body Shop owed more than £276 million (US$357 million). This included £44 million (US$56 million) to suppliers, £63 million (US$81.5 million) in lease and loan payments, £6.3 million (US$8.1 million) in taxes, and £143 million (US$185 million) to other parts of the business.

Left unpaid

Many creditors will not receive their money back. The list includes small charities like Children on the Edge, IT recycling service E-Cycle, mental health group MindOut, and the organic certifier Ecocert. Cosmetics group Avon is also owed over £13 million (US$16.8 million).

The company’s former owner, Aurelius, will not receive any repayment either.

Charles Denton now leads the Body Shop. He says the company made a £2 million (US$2.58 million) profit and £28 million (US$36.2) in sales during its first 100 days under new ownership.

Mounting issues

The Body Shop has faced multiple challenges in the past few years, as administrative changes and financial struggles prompted its bankruptcy in several countries, including Canada, Germany, Belgium, and the UK.

Earlier this year, Dutch brand Rituals also filed a €20 million (US$21.6 million) claim for trademark infringement during the brand’s Dutch bankruptcy process. At the time, Rituals spokesperson Iris Buys said the company had little hope of recovering this amount, given the bankruptcy situation.

German entrepreneur Stefan Herzberg later bought five Dutch stores through his company SHG Retail and reopened them. The Body Shop’s Dutch website now redirects to its German site.

The Body Shop says it is focused on rebuilding in 2025.