House of Fraser confirms store closures

Department store House of Fraser has confirmed that it has filed for Company Voluntary Liquidation (CVA) and will close a number of stores across the region.

Currently, House of Fraser operates 59 leased stores across the UK and Ireland and it says its property portfolio is unsustainable in its current form.

Following a comprehensive review of the group’s entire property portfolio, the directors of the companies have identified 31 stores for closure which will reduce the total store estate to 28 stores.

Stores across the region which have been identified for closure include Cirencester, Leamington Spa, Swindon, Worcester and Birmingham.

Stores in Bristol and Cheltenham are to remain open.

Commenting on the CVA proposals, Frank Slevin, Chairman of House of Fraser said: “The retail industry is undergoing fundamental change and House of Fraser urgently needs to adapt to this fast-changing landscape in order to give it a future and allow it to thrive. Our legacy store estate has created an unsustainable cost base, which without restructuring, presents an existential threat to the business.

“Whilst closing stores is a very difficult decision, especially given the length of relationship House of Fraser has with all its locations, there should be no doubt that it is absolutely necessary if we are to continue to trade and be competitive.”

House of Fraser has been on the high streets of Britain for over 160 years. The group has annual sales of £1.2bn and employs approximately 5,000 House of Fraser employees and 12,500 concession staff through over 4 million sq. ft of selling space.

However, like-for-like sales decreased by 7.4 per cent compared to the previous years, while turnover decreased 7.7 per cent.

Ian Mean, Director – Gloucestershire Chamber, Business West, said:

“I am devastated for House of Fraser employees and their families who are affected by the store closure.

“The retail environment has changed drastically in recent years, meaning that House of Fraser are no longer just competing with the likes Debenhams, John Lewis or Marks & Spencer, but with Amazon and eBay, meaning that ultimately tough decisions have to be made.

“My hope is that the store closure won’t hurt Cirencester too much, it has a strong reputation for independent retailers and new businesses are popping up all the time. “Moreover, as the retail sector modernises, jobs in stores are replaced with new, highly skilled jobs in retail technology and systems, and as such we should embrace change and see it as an opportunity for the county of Gloucestershire.”