Overview: Fashion retailers who went bust in 2016
loading...
London - 2016 was not the easiest year for most, but especially not for UK retailers. Those who were unable to keep up with the shift in consumers shopping habits, preferences and styles found themselves struggling to keep their doors open on the high street. 30 major retailers collapsed last year - 20 percent more than in 2015 - according to research from the Centre of Retail Research. Established retailers such as BHS, as well as fashion retailers such as Austin Reed, American Apparel and Ness fell into administration last year, underlining the volatility of the fashion market. Although a number of these retailers have shut their doors for good; some have made a recovery and come out of administration; others were taken over by other companies and relaunched; and others running under different names. FashionUnited has rounded up the main (fashion) retailers which went bust in 2016 below.
January: Brantano and Blue Inc
2016 did not get off to a stellar start for value shoe retailer Brantano, which fell into administration in late January. The announcement came after a tough Christmas trading period, just six months after the retailer had been acquired together with Jones the Bootmaker by investment firm Alteri from Dutch company Macintosh (which also went bust in January.) Over 2,000 members of staff working out of 140 branches and 60 concessions jobs were at risk at the time. However, one month later administrators PwC gave the green-light to the rescue plan drafted up by Alteri to save 140 retail location and some 1,400 jobs. The administrators are currently looking for a suitable buyer to purchase the remaining locations.
Blue Inc, which first started out trading in 1912 as A Levy & Son, placed its trading subsidiary A Levy into administration in January 2016 after struggling financial. The company purchased its subsidiary back the same day after the court approved of its restructuring plans, which saw the retailer shutter 76 stores from its 230 store portfolio, cutting approximately 580 jobs. However, by doing so Blue Inc managed to save 1,500 jobs across some 160 stores.
February: Ben Sherman
BSGL 1963, the UK licensee holder for menswear brand Ben Sherman, was sold through a pre-packaged administration deal to Leeds-based clothing supplier BMB Clothing in early February, 2016. Although US company Marquee Brands, which acquired the Ben Sherman brand in the summer of 2015, continues to own the brand, the deal saw BMB Clothing take over the brand’s store operations, e-commerce and wholesale operations. 3 of the brands stores in the UK closed as part of the pre-pack agreement and a report to creditors seen by Insiders states that from the 216 roles in the UK, 200 were taken over by BMB Clothing. The remaining 16 roles are said to have helped in the closing of the 3 retail locations before being made redundant.
March: Austins of Derry
Austins of Derry, one of the world’s oldest department stores, was put into liquidation in early March, 2016. The department store, which has traded for over 186 years, closed its doors for good on March 8, 2016, resulting in the loss of 53 jobs. Austins of Derry had been trading in receivership for a while, after it was saved from the brink of collapse in 2014 when it was acquired by City Hotel Group. However, although the hotel group acquired its business, Austins of Derry trading site was taken over by Hassonzender Ltd. The department store’s closure has been linked to a shift in city retail centre away from the store’s location as well as a town-centre remodelling which made it difficult for pedestrians to access the store.
April: BHS and Austin Reed
The largest UK retailer, and perhaps the most shocking, to go bust in 2016 was British Home Store (BHS), which officially fell into administration on April 25. Notably the largest retail collapse since Woolsworth, administrators Duffy & Phelps were unable to find a suitable buyer for the retail chain in the UK and eventually winded down BHS last trading stores late August, 2016. BHS’s collapse in April hit over 11,000 retail jobs as well as 22,000 pensions leading to a 571 million pounds deficit, which led to a parliamentary inquiry into the department stores’ history. Former owners billionaire Sir Philip Green and serial bankruptee Dominic Chappell are currently under investigation once more following a parliamentary inquiry into the sale of BHS and its downfall last year. Liquidators are examining the sale of BHS property during the ownership to determine if they breached their duties as directors. However not all is lost for BHS, as it live on online and overseas after its international portfolio and online business was acquired by Qatari-based group Al Mana.
Formal menswear retailer Austin Reed counted 155 stores with close to a 1,000 employees when it fell into administration in April, together with its company portfolio, a few days after it was taken over by hedge-fund Alteri Investors. Administrators AlixPartners were unable to find a suitable buyer for the entire retail company, which consisted of the brands Austin Reed, Country Casuals and Viyella in time, which led to the closure of 120 stores and the loss of 1,000 jobs. Edinburgh Woollen Mills acquired the brands, but only purchased five concession stand from the retail portfolio, saving 28 jobs.
May: Debenhams Retail
Debenhams Retail Ireland (DRIL), part of the UK’s Debenhams PLC, but a separate legal entity, saw Ireland’s High Court appoint an interim examiner to examine its affairs. The company was placed under court protection in May, 2016 following escalating losses due to high rents and staff costs, with DRIL counting 11 stores and 1,415 direct employees at the time. However, the Irish subsidiary exited examinership in late August, 2016, after a survival plan for the company was approved by the High Court, which saw the retailer’s 11 stores remain open after securing new leases and secured most of the jobs. The plan did include 98 voluntary redundancies, but no compulsory ones.
July: Store Twenty One and Hawick Knitwear
Value homeware and apparel high street chain Store Twenty One executives voted in favour of a company voluntary agreement (CVA) as the only viable solution to rescue the remaining profitable stores in July, 2016. The retailer had been struggling to stay afloat, so it agreed to shut 77 of its 220 stores as part of its reorganization of its store portfolio, in addition to cutting nearly 270 roles have been cut from 950. The company’s property subsidiaries, Be-Wise and QS Plc, are in administration.
Hawick Knitwear, a Scottish supplier and retailer of knitted goods, fell into administration in July as it was unable to find a financial return to profitability in time. The company previously announced in May that it was considering closing its production hub in Hawick, Southern Scotland. 126 members of staff have been made redundant, as the factory closed its doors for good at the end of August, 2016. A handful of employees remained on board at its customer service and warehouse.
December: American Apparel and Ness
The end of the year saw troubled US apparel retailer American Apparel, pull the plug on the UK operations. The US company filed for Chapter 11 bankruptcy protection for the second time at the end of 2016 and is currently up for sale, as Canadian manufacturer Gildan goes against the likes of Amazon and Forever 21 to acquire the ‘Made in the USA’ retailer during its bankruptcy auction. American Apparel shuttered 12 of its 13 stores in the UK before Christmas Day, with a single location off of Camden High Street in London remaining open as administrations aims to sell off the store locations. In total, 13 stores and 95 members of staff have been affected.Scottish women’s wear retailer Ness fell into administration at the end of December, 2016 following a number of financial difficulties and placing 105 members of staff at risk of being made redundant. The retailer, which counts 10 stores in Scotland and 5 in England, continues to trade for the moment as administrators BDO seek out a suitable buyer.
Homepage Photo:By Taken by Ysangkok (Self-published work by Ysangkok) [Public domain], via Wikimedia Commons