River Island has identified the 33 locations of its planned store closures in the UK, which could result in the loss of hundreds of jobs.
The clothing retailer cited a shift towards online shopping and rising operational costs as reasons for the closures, and is also seeking rent reductions for 71 additional at-risk stores from landlords.
The family-owned company, which currently operates 230 stores and employs approximately 5,500 people, has faced significant financial losses.
According to River Island’s chief executive Ben Lewis, the company’s store portfolio no longer aligns with the needs of its customers due to the increasing popularity of online shopping. He also noted that rising business costs have added to the financial strain.
While a turnaround plan is in place, restructuring is necessary, Lewis stated. He expressed regret over potential job losses and promised to minimize them as much as possible.
According to its most recent financial reports, River Island incurred a loss of £33.2m in 2023 after experiencing a 19% decline in sales.
The following stores will be closed:
AylesburyBangor BloomfieldBarnstapleBecktonBrightonBurton-Upon-TrentCumbernauldDidcotEdinburgh Princes StreetFalkirkGloucesterGreat YarmouthGrimsbyHanleyHartlepoolHerefordKilmarnockKirkcaldyLeeds Birstall ParkLisburnNorthwichNorwichOxfordPerthPooleRochdaleSt HelensStockton On TeesSurrey QuaysSutton ColdfieldTauntonWorkingtonWrexham
The company will consult with employees regarding potential job losses and will attempt to redeploy affected staff members.
According to a source, the proposed closures will not directly affect head office workers.
Creditors will vote on the plan starting on August 4, and a court will make a final decision on August 7.
River Island, originally known as Lewis and Chelsea Girl when it was founded in 1948, was renamed in the 1980s.
Hargreaves Lansdown’s head of money and markets, Susannah Streeter, stated that the proposed store closures by River Island were not unexpected given the company’s challenges.
She explained that recent changes in employer National Insurance Contributions have increased costs for retailers like River Island with a large number of physical stores.
In addition to competition from companies like Boohoo, Chinese retail giants such as Shein and Temu have also intensified the competition in the fashion retail sector, offering trendy clothing at lower prices.
Streeter noted that retail sales and consumer confidence have also been affected by inflation, making it a difficult situation for River Island and its employees.