Caversham Finance Limited, trading as BrightHouse, was the largest rent-to-own company in the United Kingdom, with 240 stores. It has been a national chain that had provided home electronics, domestic appliances, household furniture and related products on a hire purchase arrangement. Cash loans were offered towards the end of the company's life cycle.
Caversham Finance Limited was owned by private equity firm Apollo Management.
In October 2017, the company was ordered by the financial regulator, the Financial Conduct Authority, to pay 249,000 customers £14.8m due to the firm not compensating customers who had cancelled agreements after one down payment and to those who signed up to "unaffordable" lending agreements. The FCA said the retailer has not been a "responsible lender" and had treated customers unfairly.
On 30 March 2020, Grant Thornton were appointed as administrators. BrightHouse collapsed as "the company had been struggling after an influx of compensation claims for selling to people who could not repay. Its shops were then shut owing to coronavirus restrictions on retailers."
History
Brighthouse was founded by Thorn EMI in April 1994 as Crazy George, and intended to be a sister company to Radio Rentals.
Crazy George was rebranded as BrightHouse in 2002.
Caversham Finance Limited, having been initially a subsidiary of Thorn Group plc, was taken private in September 1998 in a deal arranged and financed by the Principal Finance Group of Nomura (now reconstructed as Terra Firma Capital Partners). The company was bought by Vision Capital in July 2007. It was later sold to Apollo Management in December 2017.
Brighthouse employed more than 3,000 staff as of 2012. and had 311 stores as of January 2017.
Brighthouse's revenue was £351.7 million for the year ending 31 March 2015, and its pre-tax profits were £19.6 million.
In 2017, Brighthouse submitted a reform plan to its regulator, the Financial Conduct Authority, following criticism of its lending practices, and announced plans to close 28 stores. On 5 February 2019, Brighthouse announced that 30 stores were set to close due to poor trading conditions.
In February 2020, in their quarterly report, the company said it was seeking to move away from rent-to-buy, instead wanting to "shift towards cash loans in due course." In March 2020, shortly after the UK lockdown, the holding firm of BrightHouse, Caversham Finance Limited, called in administrators.
Product offerings
BrightHouse previously stocked brands that included Samsung, Sony, Philips, Acer, LG, Nintendo, Baird, Whirlpool, Beko, BlackBerry and Nokia. The company charged interest of between 69.9% and 99.9% APR, and also charged for delivery, installation and compulsory warranties. An investigation by the BBC's Victoria Derbyshire programme in 2016 cited an example of a washing machine costing £358, with a £55 delivery and installation charge and compulsory £136 warranty. The total cost of the appliance was £1,092 at Brighthouse's typical interest rate of 69.9%.
Some sources suggested Brighthouse made it impossible to compare prices, though ex-chief executive Leo McKee (current Hamish Paton) said the retailer benefitted through a "really obsessive" approach to customer service, with "aspirational products at very competitive prices", claiming that though an active comparison is not obvious, it actively compared with other retail competitors; The Co-operative, Amazon.com, Yhor and 24Ace.
Furniture accounted for about 20 per cent of sales, audio and visual for 30 per cent, domestic appliances for 20 per cent and technology for 30 per cent.
Awards
In 2008, BrightHouse won Best High Street Recycler at the National Recycling Awards. Moreover, the company won a Green Apple Award for Environmental Best Practice.
Charity and partnerships
In October 2007, BrightHouse announced an exclusive agreement with Five to sponsor the Trisha Goddard show.
BrightHouse partnered the NSPCC in 2009. As well as running various fundraising events for the charity, BrightHouse has posters and promotional material in their stores to raise awareness.