Retail tycoon Sir Philip Green has called in advisers from Deloitte to launch a ‘radical review’ of Arcadia, as the fashion group risks losing 100 stores when their leases come to an end in late 2020, the Telegraph reported.
Arcadia, which owns Topshop and has closed more than 200 of its stores since 2016, has seen a prolonged dip in sales and profits which are thought to have led to the decision. Sir Philip Green’s plan is thought to involve discussing the possibility of closing high street stores to reduce the company’s financial strain.
When analysing Arcadia’s closure figures, the Telegraph found that Dorothy Perkins had fared the worst, seeing 62 store closures since 2016. Evans and Wallis saw 41 closures and 26 closures, respectively. The remaining 80 closures were shared between Burton, Miss Selfridge, Topshop and Topman.
More bad news for the UK high street
John Webber, head of business rates at real estate specialist Colliers International, told the Telegraph: "We have all witnessed the high profile closures and restructuring of retail businesses leading to stores shutting and large scale job losses. But what is happening quietly, without the fanfare but with the same devastating results, is the steady stream of shops that close at lease renewal or at break clauses where the keys are handed back to landlords.”
But Arcadia isn’t the only big name facing store closures. Last month, British clothing and homeware brand Laura Ashley announced that it would be closing 40 of its UK stores and all of its Australian stores as the company refocused its attention on the Chinese market. House of Fraser (HoF), New Look and Marks and Spencer also announced store closures last year amid difficult trading conditions.
On Monday, an annual report from real estate adviser Altus Group predicted that more than 23,000 shops are set to close in 2019, with as many as 175,000 jobs at risk.
So why the closures? Well, with shoppers continuing to buy more online, continued drop in high street footfall and tightened consumer purse strings amid Brexit uncertainty, many retailers are struggling to pay rents and other overheads to keep their businesses afloat.
In 2018, figures from the Local Data Company (LDC) showed that an average of 14 stores a day were being shut across the UK, with 2,692 stores shut in the first six months of the year.
Photo credit: Dorothy Perkins, Facebook