Claire’s & TOFS Enter Administration 2,550 Jobs at Risk
High street retailers Claire’s and The Original Factory Shop are on the brink of administration, placing around 2,550 jobs at risk amid worsening trading conditions on Britain’s high streets.
Both chains are owned by Modella Capital, which said insolvency proceedings had begun after attempts to rescue the businesses failed. The investment firm warned that weak consumer confidence and a sharp fall in pre Christmas footfall had left both retailers with no realistic path back to profitability.
Claire’s
In a statement, Modella said the trading environment remained “extremely challenging”, citing continued cost inflation and what it described as adverse government fiscal policies.
“This has been a very tough decision,” the firm said. “We have worked intensively to save both businesses, including last ditch rescue efforts, but neither has a realistic possibility of trading profitably again.”
Claire’s operates 154 UK stores following its purchase by Modella in September, when roughly half of the chain was acquired out of administration. The accessories and ear piercing retailer employs about 1,350 people, all of whom are now at risk. Advisory firm Kroll is expected to oversee the administration process.
The Original Factory Shop, which has 140 stores and around 1,200 staff, has filed a notice with the High Court to appoint administrators. Under the proposed process, Interpath would be appointed, giving the business 10 days of protection from creditors while talks over its future continue.
The discount homewares chain was bought by Modella less than a year ago from Duke Street Capital. It underwent a major restructure six months ago, moving its head office and distribution centre from Burnley to Bolton and securing rent reductions at several stores.
Despite those changes, the company has struggled financially, posting a £5.6m pre tax loss in the year to 31 March 2024 as sales slipped 1 percent to £117.5m.
The move to appoint administrators comes amid a wave of pressure on UK retailers. Modella also owns the former WH Smith high street business, now rebranded as TG Jones, and acquired Hobbycraft in August 2024, closing a number of outlets as part of a separate restructure.
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The potential collapse of Claire’s and The Original Factory Shop follows news that fashion chain LK Bennett has also applied to appoint administrators, putting around 280 jobs at risk.
Retailers across the UK are facing higher operating costs and subdued demand as households cut back spending in response to rising food and energy bills. Concerns about the global economic outlook have also encouraged consumers to save rather than spend.
Industry data suggests the situation has been worsened by mild autumn and early winter weather. Figures from Worldpanel by Numerator UK show clothing sales fell 1.4 percent in the four weeks to 7 December.
Attention will now turn to updates from major retailers such as Next and Marks & Spencer, which are expected to show stronger performance due to their scale and online operations.
Modella has joined a growing list of businesses criticising policies introduced by Chancellor Rachel Reeves, including tax changes, increases to the minimum wage and higher employer National Insurance contributions, which companies say have pushed up costs at a time when consumer spending remains fragile.
As administrators prepare to step in, the future of both Claire’s and The Original Factory Shop remains uncertain, adding to concerns over the long term health of the UK high street.
