The two retailers were bought by investment firm Modella Capital last year
High street chains Claire’s and The Original Factory Shop (TOFS) are being put into administration, after their owner said “last-ditch” measures had fallen through, putting about 2,500 UK staff at risk of redundancy, reports BritPanorama.
The two retailers had already undergone restructuring and were purchased by investment firm Modella Capital last year. Modella stated that it had made the “tough decision” to initiate insolvency proceedings for both businesses.
This decision will affect 1,355 employees in the UK and Ireland across 154 Claire’s shops and 1,220 staff at 140 TOFS stores. Court records indicate that a notice of intention to appoint an administrator was filed regarding both chains on Monday afternoon.
A spokesman for Modella commented: “We have worked intensively in an effort to save both businesses, having made last-ditch attempts to rescue them, but neither has a realistic possibility of trading profitably again.” He added that, in these circumstances, administration is the only viable option, attributing their vulnerabilities to issues inherited before Modella’s ownership.
Modella highlighted that challenging retail conditions, exacerbated by government policies, are impacting British businesses. In its statement, the firm noted, “The climate on the high street remains extremely challenging, and TOFS and Claire’s are not alone in experiencing difficulties.”
It further emphasized that a combination of weak consumer confidence, adverse fiscal policies, and ongoing cost inflation is afflicting many beloved businesses. “It’s a simple fact that if retailers can’t make money, they risk having to close, and jobs across the country are lost,” the spokesman stated.
Modella had previously acquired over 150 Claire’s shops last year; however, 145 of them were not included in the deal, which contributed to their closure. The fashion accessories chain had also appointed administrators for its UK and Ireland operations after filing for bankruptcy in the US.
TOFS, a discount department store chain with a presence throughout the UK, was sold to Modella in February. Modella has become an increasingly significant presence in the British retail landscape, having also acquired WH Smith’s high street chain last year and taking over arts and crafts retailer Hobbycraft in 2024.
The unfolding situation with Claire’s and TOFS underscores the pressures facing the UK retail sector, as companies grapple with consumer sentiment and operational challenges. The potential loss of thousands of jobs adds urgency to the need for effective economic strategies to support struggling retailers.
