Fashion accessories chain Claire’s is on the brink of collapse after the retailer said it will appoint administrators in the UK and Ireland, putting 2,150 jobs at risk.
The company has 278 shops in the UK and 28 in Ireland but has been struggling with falling sales and fierce competition.
Claire’s said all outlets will continue trading while administrators at Interpath said they will “assess options for the company” once appointed.
Interpath chief executive Will Wright, said this could include “exploring the possibility of a sale which would secure a future for this well-loved brand”.
Claire’s chief executive Chris Cramer said the company had taken the “difficult” decision to appoint administrators to allow stores to remain open “while we explore the best possible path forward”.
Claire’s had been particularly popular for its ear piercing services and was a common stop in the early 2000s for tweens and teens during weekend shopping trips in malls across the world.
Its stores were known for their colourful selection of hair bands, earrings, jewellery, and occasionally for toys like slime and fluffy toys.
The move in the UK comes after it filed for bankruptcy in the US earlier this month, where the firm said it was suffering from people moving away from bricks-and-mortar shops. It also had $690m (£508m) in debt.
The company operates under two brand names, Claire’s and Icing, and is owned by a group of firms, including investment giant Elliott Management.
Similar to its UK administration process, the firm said all of its US shops will remain open until an alternative future is found.
Claure’s is the latest casualty in several shop-heavy firms who have suffered from the decline of the High Street as people move more towards shopping online.
In its US filing, Mr Cramer blamed “increased competition, consumer spending trends and the ongoing shift away from brick-and-mortar retail” for the declaration of bankruptcy, as well as “debt obligations” and wider economic turmoil.
He said on Wednesday that it was a “challenging period” and 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, said the popularity of the Claire’s brand had “waned”.
While stores were once great for brand recognition, she said younger people now pay more attention to brands making their mark online.
“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 said many accessory shop chain like Claire’s have been hit by US President Donald Trump’s tariffs imposed on China and its neighbours.
“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.
Source: www.bbc.com