Hundreds of jobs at risk as River Island takes axe to store base

Hundreds much precocious thoroughfare jobs are being enactment astatine hazard arsenic portion of a sweeping overhaul of the family-owned manner retailer River Island.

Sky News has learnt that the covering chain, which trades from astir 230 stores, is proposing to adjacent 33 shops successful a restructuring program which volition beryllium enactment to creditors successful August.

The destiny of a further 70 stores is babelike upon agreements being reached with landlords to slash rent payments.

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Confirmation of the plans comes little than a period aft Sky News revealed that the company, which was founded successful 1948 by Bernard Lewis, was moving with PricewaterhouseCoopers (PwC) connected a restructuring plan.

In a connection issued connected Friday, Ben Lewis, River Island's main executive, said: "River Island is simply a much-loved retailer, with a decades-long past connected the British precocious street.

"However, the well-documented migration of shoppers from the precocious thoroughfare to online has near the concern with a ample portfolio of stores that is nary longer aligned to our customers' needs.

"The crisp emergence successful the outgo of doing concern implicit the past fewer years has lone added to the fiscal burden.

"We person a wide strategy to alteration the concern to guarantee its semipermanent viability.

"Recent improvements successful our manner connection and in-store buying acquisition are already showing precise affirmative results, but it is lone with a restructuring program that we volition beryllium capable to spot this strategy done and unafraid River Island's aboriginal arsenic a profitable retail business.

"We regret immoderate occupation losses arsenic a effect of store closures, and we volition effort to support these to a minimum."

The institution declined to remark connected however galore jobs would beryllium enactment astatine hazard by the archetypal 33 store closures, oregon connected the standard of the rent cuts being sought during talks with landlords.

In total, it is understood to employment astir 5,500 people.

Sources said that caller backing volition beryllium injected into River Island if the restructuring program is approved successful August.

Previously named Lewis and Chelsea Girl, the business, it adopting its existent marque during the 1980s.

Accounts for River Island Clothing Co for the 52 weeks ended 30 December 2023 amusement the institution made a £33.2m pre-tax loss.

Turnover during the twelvemonth fell by much than 19% to £578.1m.

A restructuring program is simply a court-supervised process which enables companies facing fiscal difficulties to compromise creditors specified arsenic landlords successful bid to debar insolvency proceedings.

An identical process is being utilized to adjacent scores of Poundland shops and slash rents astatine hundreds more.

In its latest accounts astatine Companies House, River Island Holdings Limited warned of a multitude of fiscal and operational risks to its business.

"The marketplace for retailing of manner covering is accelerated changing with lawsuit preferences for much diverse, convenient and speedier buying journeys and with expanding contention particularly successful the integer space," it said.

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"The cardinal concern risks for the radical are the pressures of a highly competitory and changing retail situation combined with accrued economical uncertainty.

"A fig of geopolitical events person resulted successful continuing proviso concatenation disruption arsenic good arsenic energy, labour and nutrient terms increases, driving ostentation and involvement rates higher and resulting successful weaker disposable income and little user confidence."

Retailers person complained bitterly astir the interaction of taxation changes announced by Rachel Reeves, the chancellor, successful past autumn's Budget.

Since then, a clump of well-known chains, including Lakeland and The Original Factory Shop, person been forced to question caller owners.