Retailers Claire's and The Original Factory Shop nearing collapse, putting over 2,000 jobs at risk
The two chains are understood to be filing for administration
High street retailers Claire's and The Original Factory Shop are on the brink of collapse, placing around 2,500 jobs at risk.
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It is understood the two chains are filing notices for administration following "an alarming drop-off in pre-Christmas footfall."
Claire's and The Original Factory Shop (TOFS) employ around 2,500 workers across just over 300 stores, and are both owned by the investment firm Modella Capital.
The filings will buy both retailers temporary breathing space from creditors, Sky News reports.
Modella Capital has around 154 Claire’s stores after buying about half the UK chain from administrators in September last year.
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A spokesperson for the group said: "Very sadly, we have had to initiate insolvency proceedings for The Original Factory Shop (TOFS) and Claire’s Accessories UK & Ireland.
"This has been a very tough decision. We have worked intensively in an effort to save both businesses, having made last-ditch attempts to rescue them, but neither has a realistic possibility of trading profitably again.
"In these circumstances, administration is the only option. In both cases, the legacy effects of trading prior to our ownership left them highly vulnerable.
"The climate on the high street remains extremely challenging and TOFS and Claire’s are not alone in experiencing difficulties.
"This is borne out by recent Sensormatic statistics and other data sources suggesting an alarming drop-off in pre-Christmas footfall.
"A combination of very weak consumer confidence, highly adverse government fiscal policies and continued cost inflation is causing many established and much-loved businesses to suffer badly.
"It's a simple fact that if retailers can’t make money, they risk having to close – and jobs across the country are lost."
Retailers are facing a tougher consumer environment as household budgets feel the pressure of higher energy and food bills.
The latest Worldpanel by Numerator UK clothing survey, previously known as Kantar, indicating fashion sales fell 1.4 per cent in the four weeks to 7 December.