Two major high street retailers are facing the possibility of administration following unsuccessful efforts by their owner to save them. Claire’s and The Original Factory Shop are set to enter administration, putting approximately 2,500 employees in the UK at risk of losing their jobs, Modella Capital confirmed. Both the fashion accessories and discount department store chains will go through insolvency proceedings in the UK and Ireland.
Modella cited tough trading conditions and a significant decline in pre-Christmas foot traffic as the primary reasons for resorting to administration, describing it as the only viable option for the retailers. These companies had previously undergone restructuring after being acquired by the firm last year.
Claire’s, with 1,355 employees spread across 154 stores in the UK and Ireland, filed for bankruptcy in the US earlier in August, revealing a debt of $690 million (£508 million). The chain, operating 278 stores in the UK and 28 in Ireland, had incurred losses totaling £25 million over the past three years in the UK.
Last September, British private equity firm Modella purchased 156 of Claire’s UK stores from administrators Interpath, safeguarding around 1,000 jobs. However, 145 stores, employing approximately 1,000 individuals, were excluded from the deal and subsequently closed.
The Original Factory Shop (TOFS), which recorded a pre-tax loss of £5.6 million in the year ending March 31, 2024, was acquired by Modella in February 2025. The discount chain had been under the ownership of Duke Street, another private equity firm, since 2007. TOFS currently operates 140 stores and employs 1,220 people, all of whom are now facing potential job losses.
Court records indicate that a notice of intention to appoint an administrator for both chains was submitted on Monday afternoon. A Modella spokesperson stated, “Despite our intensive efforts to rescue both businesses, the harsh reality is that they are not viable for profitable trading. Administration is the necessary step forward given the circumstances, as the legacy challenges from previous trading left them highly exposed.”
The company highlighted the extremely challenging environment on the high street, attributing it to weak consumer confidence, unfavorable government fiscal policies, and ongoing cost inflation.