River Island has been given the inexperienced gentle to shut 33 shops throughout the UK after the Excessive Courtroom permitted the style retailer’s restructuring plans.
The Excessive Avenue model stated a buyer shift in direction of on-line buying and better working prices had contributed to multi-million pound losses.
It had warned its collectors that it might run wanting money by the top of August if its turnaround proposal was not permitted.
In addition to closing retailers, rents might be decreased at an additional 71 branches as a part of the plan which, River Island’s chief govt Ben Lewis, stated “will allow us to align our retailer property to our clients’ wants”.
Negotiations are because of start with these landlords shortly.
In addition to the shop closures and hire reductions, about 110 of roughly 950 roles at River Island’s head workplace might be made redundant, saving an estimated £8.1m.
The retailer has already closed seven loss-making retailers this yr, River Island’s barrister Matthew Weaver KC advised the Excessive Courtroom.
He stated that until the restructure was permitted, the choice was insolvency.
Mr Lewis stated the corporate has a “clear transformation technique” to make sure the enterprise has a future, “and this determination offers us a robust platform to ship this”.
Charles Allen, an intelligence analyst at Bloomberg, stated River Island had been affected by points felt by many UK retailers, such because the shift to on-line buying.
“There’s simply much less enterprise getting into retailers,” he advised BBC’s Right this moment programme. He added that rising prices have additionally been exacerbated by the rise in employer Nationwide Insurance coverage Contributions.
Initially identified in Chelsea Woman, it was rebranded in 1988 as River Island and grew steadily, however in recent times has skilled declining gross sales, Mr Weaver stated.
The restructuring will contain closing 33 shops from January 2026, and negotiating with the landlords of an additional 71 shops to scale back rents in some instances to zero.
Mr Weaver acknowledge that in some instances, landlords could favor to regain store area earlier than the top of leases.
With the restructure, the corporate is forecasting 1% annual development for the subsequent 5 years.