The challenges facing the high street have been well documented, and as the year draws to a close and consumers turn their attention to Christmas shopping, retailers are hoping to take a slice of increased seasonal spending to top up their bottom lines.
However for some, even a successful Christmas will be too little too late. The first half of 2019 saw 2,868 store closures, a number which equates to 16 every day. This is the greatest number of store closures seen for five years and while figures for the final half of the year are yet to be seen, it is likely they will make for equally glum reading.
Sectors suffering the biggest net declines on our high streets were: fashion retailers who lost 118 net stores, restaurants losing 103 outlets, estate agents suffering a 100 branch net drop, and pubs where 96 more closed than opened between January and June this year.
This has undoubtedly been a trying year for many within retail, but some high street stalwarts found the tough trading conditions increasingly difficult to manage and succumbed to the pressure. While for some companies 2019 was a time for restructuring and reassessing their market position, for others 2019 marked the end of their time on our high streets. Here we look at those retailers for whom 2019 will go down as a year they would rather forget.
- Patisserie Valerie – 2019 started with the news that an accounting scandal had forced café chain, Patisserie Valerie, to bring in the administrators. Around 70 of the company’s 200 branches were closed immediately with the loss of 900 jobs. Causeway Capital stepped in to rescue the chain in a move which saved around 2,000 across the remaining 100 stores. Since the takeover more than 20 of these stores have shut their doors for good, although the company does still continue to enjoy a substantial presence across the country.
- Bon Marche – The womenswear retailer entered administration in October, putting 2887 jobs at risk across 318 stores around the country. Talks with potential buyers are still ongoing and the company continues to trade, however, 100 stores are likely to close.
This is the second time the struggling retailer has collapsed into administration; the first time was in 2012 when it was subsequently saved as part of a rescue deal by private equity firm Sun European Partners. At the time of its administration this time around, the company was controlled by Philip Day, owner of the Edinburgh Woollen Mill Group, who had a 95 per cent ownership in the retailer.
- Mothercare – Blaming increased competition from both supermarkets and online retailers, the baby goods retailer called in administrators in November. After 58 years of trading, all 79 UK stores are set to close putting 2,500 jobs on the line. While the name will disappear from UK high streets, it appears the brand will live on thanks to its strong presence overseas. Mothercare operate more than 1000 stores across 40 countries which will continue to trade as these do not form part of the administration.
Trouble was initially flagged up at the retailer when it entered into a Company Voluntary Arrangement (CVA) 18 months ago which led to the closure of 55 stores as it attempted to streamline operations and reduce outgoings. CVAs have become increasingly popular, particularly with high street retailers; however, Mothercare is a prime example of how a CVA is not a panacea to trading troubles.