A wedding and occasion wear designer and retailer has secured funding from the Coronavirus Business Interruption Loan Scheme (CBILS) through Clydesdale Bank, part of Virgin Money UK, to sustain the business through the Covid-19 crisis.
London-based Monga’s, which specialises in bespoke and ready-to-wear traditional Indian wedding attire, closed its shop on 20 March in line with government requirements to address the coronavirus pandemic.
The closure came into force as the family-run business geared up for spring, the busiest season of the year for weddings, with projected weekly sales of up to £200,000. With large gatherings, such as weddings and other occasions, unlikely to be possible for many months, the company is expecting sales to be impacted for some time beyond the lockdown. The company had already invested significantly in stock to meet the seasonal demand.
Monga’s directors, Ankit and Arun Monga, have worked with Clydesdale Bank to put in place a range of financial support to sustain the business. Two CBILS loans with two-year and five-year payment terms have been agreed to cover short-term and longer-term costs and working capital. The directors have also negotiated payment terms with suppliers and benefited from the UK Government’s business rates waiver for retailers, as well as the job retention scheme, with its 42-strong team placed on furlough.
CBILS is a UK Government initiative facilitated by participating banks to provide financial support to SMEs that are losing revenue, and seeing their cashflow disrupted, due to the Covid-19 outbreak. Under the scheme, existing Clydesdale Bank business customers can borrow £10,000 to £5 million.
Ankit Monga said:
“Our sales have taken a drastic hit because of the lockdown. We have missed out on our busiest six-week period of the year. Many weddings have been postponed, and we don’t know yet when they can start taking place again. The financial support from Clydesdale Bank has been a big help. Without it, we wouldn’t have been able to pay our suppliers. With this funding, we have been able to maintain our supply chain to ensure we can reopen when the time is right.
“We have plans to continue growing the business and, despite these very difficult financial circumstances, we feel we will still be able to achieve them with the help we’ve had. We are very grateful to the team at Clydesdale Bank. Our relationship manager, Simon, has offered us so much practical support, which will save the long-term future of our business.”
Monga’s was established in 1996 by Arun Monga as a fashion exporter, but popularity led to the company’s first boutique opening in London in 2004. Continued growth has led to a reputation as a leading Asian designer brand, and the company manages its own manufacturing unit in India, which employs more than 700 people. Ankit, Arun’s son, took on management of the company in 2014 and has been leading its ongoing expansion.
Monga’s has been a Clydesdale Bank business customer since 2016, when the bank assisted with the purchase of new business premises.
Simon Gallie, relationship manager at Clydesdale Bank said:
“We have worked with Ankit and Arun to work out the best package of support for their business. The business has a track record of retaining profits, with strong potential to continue growing in the future. The funding package will allow the business to recommence trading when possible with supplier relationships intact.
“The coronavirus pandemic has created extremely challenging conditions for retailers. Many are missing out on peak trading times of the year because of the lockdown. There is financial help available to help businesses survive and we encourage customers to get in touch with us if they are worried about the financial impact of coronavirus.”