River Island, a British high street staple, has announced plans to shutter 33 UK stores, jeopardizing hundreds of jobs. The retailer attributes this decision to the rising popularity of online shopping and escalating operational costs.
Further, the company is seeking rent reductions from landlords at an additional 71 at-risk locations. This restructuring comes amidst significant financial losses for the family-owned business, which currently operates 230 stores and employs approximately 5,500 individuals.
Chief Executive Ben Lewis acknowledged the shift in consumer behavior, stating that River Island’s extensive store portfolio no longer aligns with evolving customer needs. He also cited a substantial increase in operational costs as a contributing factor to the financial strain.
While implementing a turnaround strategy, Mr. Lewis emphasized the necessity of restructuring. He expressed regret regarding potential job losses and pledged efforts to minimize their impact. The company reported a £33.2 million loss in 2023, accompanied by a 19% decline in sales.
River Island will initiate consultations with affected employees, prioritizing staff redeployment where feasible. A company source confirmed that head office personnel will remain unaffected. Creditors will begin voting on the restructuring plan on August 4th, with a court hearing scheduled for August 7th to finalize approval.
Established in 1948 under the names Lewis and Chelsea Girl, River Island rebranded to its current name in the 1980s.