Claire's and The Original Factory Shop Are on Brink of Collapse, Threatening 2,550 Jobs
In a devastating blow to British retail, Claire's and The Original Factory Shop are teetering on the edge of administration. This drastic measure puts around 2,550 jobs at risk as the two high street chains struggle to stay afloat in an increasingly challenging market.
Private equity firm Modella Capital, which recently acquired WH Smith's high street arm, has cited an "alarming drop-off" in pre-Christmas footfall and described the climate on UK high streets as "extremely challenging". The company has made a last-ditch effort to save both businesses, but ultimately believes that neither can operate profitably again.
Modella Capital's decision comes despite recent efforts to revamp both chains. Claire's saw an investment of around half its UK stores by the firm in September last year, while The Original Factory Shop was acquired from Duke Street Capital just over a year ago and underwent a restructure with store closures and rent cuts.
The firm has been struggling for some time, with a pre-tax loss of £5.6m recorded in the year to March 2024 as sales fell by 1% despite high inflation. Other retailers are also feeling the pinch, including fashion chains LK Bennett and Next, which recently reported a decline in sales.
A tough consumer environment, driven by rising energy and food bills, has led households to increase their savings, while concerns about the economic and global political environment have prompted some consumers to cut back on discretionary spending. The latest Worldpanel survey found that UK fashion sales fell 1.4% in the four weeks to December 7.
With administrators appointed for both chains, around 1,350 jobs will be at risk at Claire's, while an estimated 1,200 positions are under threat at The Original Factory Shop. It remains to be seen whether either chain can recover from this setback and find a new path forward in the challenging retail landscape.
In a devastating blow to British retail, Claire's and The Original Factory Shop are teetering on the edge of administration. This drastic measure puts around 2,550 jobs at risk as the two high street chains struggle to stay afloat in an increasingly challenging market.
Private equity firm Modella Capital, which recently acquired WH Smith's high street arm, has cited an "alarming drop-off" in pre-Christmas footfall and described the climate on UK high streets as "extremely challenging". The company has made a last-ditch effort to save both businesses, but ultimately believes that neither can operate profitably again.
Modella Capital's decision comes despite recent efforts to revamp both chains. Claire's saw an investment of around half its UK stores by the firm in September last year, while The Original Factory Shop was acquired from Duke Street Capital just over a year ago and underwent a restructure with store closures and rent cuts.
The firm has been struggling for some time, with a pre-tax loss of £5.6m recorded in the year to March 2024 as sales fell by 1% despite high inflation. Other retailers are also feeling the pinch, including fashion chains LK Bennett and Next, which recently reported a decline in sales.
A tough consumer environment, driven by rising energy and food bills, has led households to increase their savings, while concerns about the economic and global political environment have prompted some consumers to cut back on discretionary spending. The latest Worldpanel survey found that UK fashion sales fell 1.4% in the four weeks to December 7.
With administrators appointed for both chains, around 1,350 jobs will be at risk at Claire's, while an estimated 1,200 positions are under threat at The Original Factory Shop. It remains to be seen whether either chain can recover from this setback and find a new path forward in the challenging retail landscape.
. I mean, 2,550 jobs are on the line and they're just gonna fold? It's not like they didn't see this coming... I guess it's just another sign of how hard retail is to survive in today's climate 
. And let's be real, who's really buying anything anymore? I mean, I'm over here saving up for a energy-efficient fridge and my friends are all about those savings goals 
. The Original Factory Shop's restructure was a pretty obvious step... it's not like they didn't know they were taking a risk by acquiring Duke Street Capital in the first place 
. Anyways, I guess we'll just have to wait and see which of these chains will manage to limp back into profitability 
.
2,550 jobs are at risk and that's just devastating. It’s not like it’s the end of the world or anything, but still... those people have families to support too 
. I mean, I know the high street is struggling and all, but is there no way we can find a solution that doesn’t involve so many jobs getting lost in the process? 
I mean, Claire's and The Original Factory Shop were like, iconic high street brands 
but it looks like they just can't compete with the online shopping game anymore 
. And poor Modella Capital, they're like, trying their best to save them but it's just not happening 
. private equity firms are trying their best, but its hard when consumers are tightening their belts due to high inflation and uncertainty about the future 
. 2550 jobs at risk is just heartbreaking, i really wish there was more we could do to support these communities 
2,550 people are counting on them 
and let's be real, uk fashion sales have been slumping for ages... rising energy bills aren't helping either 
️ maybe it's time for a new model or something 
we all need a little retail therapy every now and then 
. It's not surprising that retailers like Claire's and The Original Factory Shop are struggling to stay afloat 
. The fact that Modella Capital has cited an "alarming drop-off" in pre-Christmas footfall and described the climate on UK high streets as "extremely challenging" is a stark reminder of the challenges facing these retailers 
. With around 2,550 jobs at risk, it's essential that we think creatively about how to support our high street retailers and help them adapt to changing consumer habits 
Claire's was like my fave place to get those cute accessories and The Original Factory Shop had the best selection of shoes ever I know it's tough times for everyone but still, 2,550 jobs at risk? 
That's just crazy. They should've invested in more online shopping or something 
.
Claire's and The Original Factory Shop were always my go-to places for accessories and quirky gifts... I don't know what I'd do without them! 
i mean who doesn't love browsing those shops for cheap jewelry and accessories right? 
anyway idk what's gonna happen now theyre basically at risk of collapsing and thats just a bummer 
gotta feel for the employees who might lose their jobs 
!
. People have been complaining about them for ages, and now they're getting the boot 
. It's not like they were doing anyone any favors by keeping all those jobs just to keep people employed. I mean, who needs a bunch of deadstock stores cluttering up our streets? Not me, that's for sure 
. And let's be real, Claire's and The Original Factory Shop have been struggling for ages. They just needed a wake-up call to realize they were out of touch with reality 
. Now, maybe we can get some fresh blood in there and revamp the whole industry 
. Bring on the chaos! 