Phones 4u collapse puts iPhone 6 orders in doubt

The Phones 4u chain is to enter administration, potentially leaving customers who pre-ordered iPhone 6 handsets from the retailer out of pocket.

Phones 4u collapsed after both EE and Vodafone decided not to renew their contracts with the retailer, seemingly preferring to sell phones to customers directly.

All of Phones 4u’s 550 stores will be closed today, and the company’s website is unavailable. Around 5,500 jobs are believed to be at risk.

The company claims that any current mobile contracts taken out via Phones 4u will be unaffected by the administration, but any unfulfilled orders – such as pre-orders of the iPhone 6, which doesn’t go on sale until later this week – will be, according to a report on the BBC.

PricewaterhouseCoopers is expected to be announced as the administrator today, and customers will have to wait for guidance from the administrator.

Customers who paid for handsets over the weekend may want to contact their bank or credit card company to see if they payment can be stopped.

Networks pull out

Phones 4u said it was surprised by the networks’ decision to cancel their contracts. Vodafone decided not to renew its contract with the company last Monday, leaving EE as the retailer’s sole network partner.

Late on Friday, EE also decided to pull the plug, effectively leaving Phones 4u without anything to sell once those contracts had run their course, prompting the company to immediately call in the administrators.

“The unexpected decisions by both Vodafone and EE have come as a complete shock to the business,” a Phones 4u statement reads. “The company is in a healthy state and both EE and Vodafone had, until very recently, consistently indicated that they saw Phones 4u as a long-term strategic partner.”

Phones 4u claims the company was profitable and has “significant cash in the bank”, although how quickly that will be swallowed up by creditors and staff salary payments awaits to be seen.