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Karat Marketing announces imminent closure

karat marketing
Karat Marketing announces imminent closure

Scottish agency Karat Marketing has announced that it expects to close officially within the next week.

Karat Marketing’s closure is expected by 12 June. The agency’s 17 staff and charity clients have been informed, and its directors have met with administrators to begin a consultation process. According to Karat, no money however is owed to charities.

Karat launched in 2015. According to the agency, every campaign undertaken since then has either hit or exceeded targets, and it has raised over £750,000 for UK charities. In a statement, it blamed the collapse on “the current challenging and volatile market conditions in the Scottish charity sector combined with hesitation surrounding the GDPR legislation”, saying that as a result it has become much more difficult for charities to sign off campaigns.

In the statement, Lauren Semple, Development Director of Karat, said:

To announce our closure is absolutely heart-breaking for all involved. We have tried our hardest over recent months to keep the business going, the three directors have not taken salaries and our staff have been amazing in taking reduced hours, to support the business, for which we thank them sincerely. While we have supportive clients, the work just isn’t there and we’ve exhausted all our options to keep afloat. Making this decision has been very difficult and is our absolute last resort.

“The Scottish market is very difficult just now, charities are being cautious, understandably and still adjusting to the required changes for GDPR, campaigns can be moved or cancelled at the last minute and we have experienced longer than usual campaign sign-off periods – for some we’ve had to wait 4 or 6 months for a start date and, very sadly, this has meant we’ve been unable to hold on. We have simply been unable to secure long term contracts to ensure our business can continue providing services to our clients.”

Karat Marketing opened in Dunfirmline, Fife, in 2015, the home of former telephone fundraising agency R Fundraising, shortly after that agency closed but was unrelated to R Fundraising, and a joint venture between Revolutionise, based in Fort Augustus, and Dialogous Fundraising, based in Copenhagen. It did however take on 25 of R Fundraising’s former staff.

It offered telephone fundraising, strategy, creative and data services to charities with clients including Friends of the Earth, PoppyScotland, Quarriers, Scottish Association for Mental Health, Thistle Foundation, The Children’s Trust, Sense Scotland, Erskine, Children’s Hospices Across Scotland (CHAS), Chest Heart & Stroke Scotland.

Talking to UK Fundraising, Semple added:

“Karat was set up in 2015 after Scotland’s only agency, R Fundraising closed. It was a completely different company with a different directorship but allowed some of the staff who had lost their jobs with R Fundraising, to get a new job providing quality telephone fundraising for Scottish charities”.

“Our aim was always to be small – to provide consultancy and telephony for primarily Scottish charities but also those who had small programmes or needed support in other ways. The wide range of expertise the directors had enabled us to work very closely with our clients and provide service bespoke to their needs. They also had strong relationships with the fundraisers, which was very important to us.

“Karat was a mission driven enterprise for us, with a desire to ensure Scotland had a fundraising agency, the brilliant clients had what they needed and that the staff we knew and cared for were employed.  We never gave up on this and sacrificed our own investments and incomes to try and achieve stability.

“Since going into administration, we have been helping staff in any way we can and I have also been in touch with other telephone agencies and introducing them to some of our clients, in the hope that our clients will be able to continue the programmes that Karat were unable to finish.”

Melanie May is a journalist and copywriter specialising in writing both for and about the charity and marketing services sectors since 2001. She can be reached via www.thepurplepim.com.

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