Claire’s, the fashion accessories retailer, has entered administration in the UK and Ireland, placing 2,150 jobs at risk.
The company, which operates 278 stores in the UK and 28 in Ireland, has faced challenges stemming from declining sales and increased market competition.
Claire’s has stated that all stores will continue to operate as administrators evaluate “the best possible path forward” for the business.
Interpath, the appointed administrator, has indicated that they will “assess options for the company,” which may involve a sale of the business aimed at “securing a future for this well-loved brand.”
Chris Cramer, Chief Executive of Claire’s, described the decision to appoint administrators as “difficult,” but necessary to allow its stores to remain open.
Claire’s was a popular destination, especially known for its ear-piercing services, and a frequent stop for young teens during weekend shopping trips, in the early 2000s.
The store was notable for its colorful collection of hair accessories, earrings, jewelry, and various novelty items.
The store will no longer be issuing refunds, nor accepting online orders.
It will also not be delivering orders which have not yet shipped, but says customers are only charged on dispatch of items, so customers with outstanding online orders should not be out of pocket.
This development follows the company’s recent bankruptcy filing in the United States earlier this month, citing a shift in consumer behavior away from physical retail locations. The company is reported to have $690m (£508m) in debt.
Claire’s operates under the Claire’s and Icing brands and is owned by a group of firms, including investment firm Elliott Management.
In line with its approach in the UK, the company has stated that all of its US stores will remain open as it explores potential alternatives.
Claire’s is the latest retailer to be affected by the challenges facing brick-and-mortar businesses amid the growing trend of online shopping.
In its US filing, Mr. Cramer attributed the bankruptcy declaration to “increased competition, consumer spending trends and the ongoing shift away from brick-and-mortar retail,” as well as “debt obligations” and broader economic pressures.
On Wednesday, he acknowledged the “challenging period” and stated that “in the UK, taking this step will allow us to continue to trade the business while we explore the best possible path forward.”
Susannah Streeter, head of money and markets at Hargreaves Lansdown, suggested that the popularity of the Claire’s brand had “waned.”
She noted that while physical stores once played a crucial role in brand recognition, younger consumers are increasingly influenced by brands that establish a strong online presence.
“The chain is now faced with stiff competition from Tiktok and Insta shops, and by cheap accessories sold by fast fashion giants like Shein and Temu,” she said.
Other analysts have suggested that accessory retailers such as Claire’s have been negatively impacted by tariffs imposed by US President Donald Trump on goods imported from China and neighboring countries.
“A lot of that category is sourced from Asia, and any increase in import costs hits hard when your price points are low and margins are tight,” retail analyst Catherine Shuttleworth said at the time of Claire’s US bankruptcy filing.
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