Major fashion brand with 220 stores closing branch in blow to high street | UK | News
A major fashion retailer is closing a store in a major blow to Britain’s high street. River Island is closing its branch at the Old Market Shopping Center in Hereford on January 31.
It comes as River Island moves forward with plans to close 33 stores as part of a restructuring bid following heavy losses. The clothing retailer’s restructuring plan was approved by the Supreme Court in August. In addition to the closures, rent reductions and debts of 71 stores will also be erased. River Island currently has more than 200 stores across the country, 122 of which are unaffected, and employs around 5,500 staff. River Island CEO Ben Lewis said: “We have a clear transformation strategy to ensure the long-term sustainability of the business and this decision provides us with a strong platform to deliver this.”
He added: “The latest developments in our fashion offer and shopping experience are starting to show results and the restructuring plan will allow us to align our store space to the needs of our customers.
“We are grateful to our suppliers, landlords and other stakeholders for their constructive engagement and shared confidence in the future of River Island.”
In June, Mr Lewis said that although River Island was a “much-loved” British retailer, the rise in online shopping had left the business with “a large portfolio of stores that no longer suit the needs of our customers”.
He added that “the sharp increase in the cost of doing business over the last few years has only increased the financial burden.”
The business reported a pre-tax loss of £33.2 million in 2023 following a 19% drop in sales; According to its calculations, losses will almost double to £64 million in 2024.
To cut its losses, it demanded that landlords cut their rents for three years and paused payments on some units. The plan was approved by a High Court judge in August last year.
