The UK’s high street retail sector has suffered another blow, with prominent retailer Debenhams set to close all of its 124 stores after Christmas.
The retailer, which has been operating for 240 years, was placed in liquidation on Tuesday in the UK, in a move that puts 12,000 jobs at risk.
On Monday, Sir Philip Green’s Arcadia group, owner of Topshop and Miss Selfridge, fell into administration, putting 13,000 retail jobs on the line.
According to The Guardian, several other UK high street retailers have also been hit hard by coronavirus lockdowns and the massive shift to online retail this year, including Edinburgh Woolen Mills and Peacocks and Jaeger.
Administrators had been operating Debenhams since April but were unable to secure a buyer for the retail chain, the history of which dates back to a drapers store established by William Clark in London in 1778.
The department store ventured into Australia back in 2017, opening a “small, curated offer” in the Melbourne CBD, as the first of what was slated to be 10 stores across the country.
Its entry into the Australian market was through a deal with Harris Scarfe parent company Pepkor South East Asia, a subsidiary of South African Retail giant Pepkor Group. At the time, the retailer had ambitious plans to take on local department stores Myer and David Jones.
However, those plans didn’t eventuate and the Melbourne store was the only Debenhams location to open here. That store closed in January this year.
In the UK, a possible rescue deal with sports retailer JD Sports had been on the table, however, JD Sports reportedly pulled out of the talks when Arcadia collapsed.
Arcadia operated concessions within Debenhams stores, which were an important source of sales for the group.
Administrators for Debenhams will continue to look for a buyer for the chain as the stores commence a stock clearance sale.
The first store closures are expected to take place in January, with the remaining stores to close by the end of March if a buyer is not found.
Geoff Rowley, partner at FRP Advisory and joint administrator of Debenhams, said in a statement “all reasonable steps were taken to complete a transaction that would secure the future of Debenhams”.
“However, the economic landscape is extremely challenging and, coupled with the uncertainty facing the UK retail industry, a viable deal could not be reached,” he added.