Debenhams: end of an era for another high street retailer?

London - First came the collapse of BHS, followed by House of Fraser and now Debenhams. Even John Lewis is suffering from an all-time trading low. And then there is longtime suffering Marks and Spencer, planning to close over 100 stores by 2022.The British high street is in disarray as mid-level department stores are no longer the pinnacle of modern day shopping.

Mismanagement is often cited as the reason behind rollercoaster losses, but actually it is due to a growing number of department stores becoming lifeless, not only in the UK, but also in the US, Canada and Europe. Lack of consideration for experience, uniqueness, customer service and visuals have become a norm across many department stores. There is no joy in shopping in a store with crumbling ceilings and hospital flooring, with rails stuffed with garments and uninspiring product categories. No matter how affordable the goods, if everyone can buy the same products online retailers must give depth to the shopping experience to attract consumers.

Debenhams once had a presence. Founded in the eighteenth century with only one outlet, it grew to be a best-loved brand on the UK high street, boasting a 180 store retail portfolio across the UK, Ireland and Denmark. It now plans to close 50 branches, nearly a third of its UK operations, with 4,000 jobs at risk.

Debenhams failed to invest in its stores

Instead of investing in its stores, upgrading its interiors, rethinking its product offer and mapping out an experiential, customer-centric vision, Debenhams cut its refurbishment budget by 77 percent to less than 7 pounds per square foot. According to the Independent that is less than one-tenth of what Marks and Spencer were spending at the time. Similar to the downfall of BHS, "a lack of investment and a huge amount of borrowing allowed the financiers to make off with bumper profits while the business was left with 1.2bn pounds of debt. That left it particularly ill-equipped to tackle the huge upheavals faced by retailers in the post-crisis era," wrote the Independent last summer.

Near constant headlines of ailing retailers

The pressures, closures, and failures on the UK High Street have seldom been out of the headlines this year. Earlier this month rival department store chain House of Fraser was bought out of administration by Mike Ashley's Sports Direct. And Marks and Spencer and Mothercare both announced branch closures.

Richard Lim, chief executive of Retail Economics told the BBC that Debenhams was operating in the part of the market under the most intense amount of pressure. "Put simply, department stores are incredibly expensive to run," he said. "The combination of too much space, inflexible leases and spiralling operating costs are set against a backdrop an accelerating behavioural shift towards online and experiences. This is eroding their profitability and changes in the business need to occur at a pace if they are to survive."

In the nineties Debenhams was a high street leader. Its Designers at Debenhams ranges introduced in 1993 made luxury affordable and saw cool collaborations with brands such as John Rocha and Matthew Williamson alongside many key designers from London fashion week. It brought boutique brands into the high street, but the formula got tired as other retailers caught on and did it better, like Topshop and H&M.

It is unclear if the store closures will be effective if the wider turnaround strategy doesn't integrate the bigger picture. Especially if the remaining stores remain a portfolio of uninspiring shopping outlets.

Photo courtesy of Debenhams