NEWS | Round-up IT crisis tips Rational into insolvency


KITCHEN FURNITURE brand Rational has applied for insolvency in its native Germany after weeks of speculation.


The announcement came just days before the


annual Küchenmeile trade fair which would’ve seen dealers from all over Europe descend on the company’s in-house exhibition. The company filed for insolvency proceedings on September 16 at the local court of Osnabrück and Stefan Meyer of Pluta Rechtsanwalts GmbH has been appointed as provisional administrator. The company’s website says that Rational has more than 60 retailers in the UK.In an email sent to dealers early on the evening of September 15, the company said that a massive IT failure had meant the insolvency was unavoidable.


The email said: “At the beginning of this week, we informed you that


significant parts of our server


system were damaged by a regional power failure in such a way that we are currently not able to continue processing orders, nor can we forward data on existing orders to production.


“After checking by our IT department and external specialist companies, it takes at least four to six months to rebuild the data. This means that we are currently unable to make any statement as to when production of the kitchens can be resumed. “Considering the current situation, the management felt compelled to apply for provisional insolvency proceedings at the district court in Osnabrück today, September 16, 2022.”


In an official statement from Rational, the company said that in view of the fact that it is not “technically possible” to recover the lost data from its IT system, “it cannot be stated with any certainty when kitchen production may resume”.


The statement said that the firm intention is to


“preserve the business, avoid liquidation and, as soon as possible, find a solution that will keep the company going”. The insolvency proceedings are intended to “motivate the current owners and encourage all suitable domestic and international strategic investors as well as interested financial investors to take over the company in spite of the


very difficult situation and guide it towards a good and stable future”.


Provisional insolvency administrator Stefan Meyer said: “We are doing all we can to stabilise the business – an enormous challenge given the extremely exceptional circumstances. We will also work with the management team and the excellent and highly skilled workforce on ways of resolving this situation as quickly as possible so that a long-term solution can be found for this established company following this unavoidable interruption to distribution, design, production and sales.” Meyer added: “We also decided in close consultation with management to cancel participation in the Küchenmeile kitchen trade fair. Although we regret having to take this step, there is no point in welcoming customers and business partners when we cannot say with any reliability at this stage when Rational


will be up and running again and the business can resume operations.” Rational GmbH managing director Mano Bakhtiari said: “We have tried everything to resolve the IT issues over the past two weeks. Unfortunately, this has proven technically impossible in the short term. Filing for insolvency was therefore unavoidable. This situation is extremely stressful for all involved,


Retailers shocked and worried...


RATIONAL RETAILERS have been shocked by the insolvency of German kitchen brand Rational and many are worried about the cost of refunding deposits and ripping out and replacing displays.


The company filed for insolvency proceedings on September 16 at the local court of Osnabrück and Stefan Meyer of Pluta Rechtsanwalts GmbH has been appointed as provisional administrator. In an email sent to dealers early on the evening of September 15, the company said that a massive IT failure had meant the insolvency was unavoidable.


Neil Harradine, owner of Eclectic Interiors in London, told kbbreview: “We found out by email and it is a bit of a shock – when it can happen to a company that big that quickly.


4


Rational seems to want to carry on, but we can’t wait six months for them to rebuild their computer systems.” He added: “I don’t know going forward whether we could or would stay with them. We are still evaluating that. We have no information on how or when it is going to restructure. “For 20 years we had no problems at all with them. No issues. No delays. But it got more variable with Covid.” Harradine said he was also already looking at potential new suppliers. “We were expecting delivery of kitchens in the next couple of weeks which apparently won’t be coming now,” he told kbbreview, “so we will find out what the status is with those. “We have had to look for new suppliers for contracts that we were just about to put orders in for. “But first we have to go back to the client and say that the kitchen


we proposed doesn’t look like it can be produced.”


Harradine added that there were three Rational displays in the showroom that he would now have to replace. Meanwhile, Ron Wilkinson, owner the Fitted Kitchen Centre


of in


Plymouth, was also worried about the cost of replacing showroom displays. He said: “It was a bit of a shock. We were not expecting it at all and we didn’t have a clue until we saw it on the internet. “We have been dealing with them since 1981 and it was very good for us. But we also do Crown Imperial.” Asked how it would affect his business, Wilkinson said: “It will affect us as it makes all of our displays obsolete and we will have to replace them.


“The problem is that even if we


manage to sell any of them, we’re not going to be able to get the bits to match. Luckily it does not affect any orders in the pipeline at the moment, but it will leave us out of pocket by making those displays obsolete.” One retailer, preferring to speak off the record, told kbbreview: “I have one order that I had to tell the client I couldn’t supply and so I have had to give him his money back. I am looking at alternatives for him. “This was a very big order, nearly £20,000 trade. I placed the order and two days later got an email from Germany telling me about some system problem which I couldn’t make head nor tail of. “So I am very disappointed and


there’s a very real possibility that I might well not make any money at all if my customer doesn’t go with any of my alternatives.”


· November 2022


especially customers and employees. But we will do everything we can to find solutions for our company together with the provisional insolvency administrator. We are in contact with our customers and will keep them informed of developments.”


Previously owned by Italian kitchen furniture brand Snaidero, Rational – including its UK subsidiary Rational Built-In Kitchens Ltd – was bought by the international Bravat Group in April 2021. This is just the latest in a string of high-profile German kitchen companies that have had to file for insolvency. In January 2022 German kitchen manufacturer Bax Küchen filed for insolvency. Neue Alno filed for provisional insolvency in July last year as part of its plan for financial restructuring, leading to it finally closing its doors and ceasing operation in September that year. In 2020, Poggenpohl filed for insolvency, blaming the coronavirus pandemic for a significant drop in business. The company was rescued, however, by Jomoo Germany, a subsidiary of the Chinese Jomoo Group. In March 2019, Warendorf filed for insolvency citing liquidity problems, but in July that year was rescued by an Asian investor based in Hong Kong.


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