River Island is set to close 33 of its stores as part of a comprehensive restructuring strategy aimed at revitalizing the business. Additionally, the future of 71 more branches hinges on ongoing negotiations to secure reduced rents with landlords, potentially bringing the total number of closures even higher. These changes would bring the retailer’s total store count to fewer than 200 locations nationwide.
Founded in 1948, River Island has a long-standing presence on the British high street. However, shifts in consumer habits towards online shopping have left the company with a store network that no longer reflects customer demand. Ben Lewis, River Island’s Chief Executive, explained, “River Island is a much-loved retailer, with a decades-long history on the British high street. However, the migration of shoppers to online channels, combined with rising operating costs, has created financial challenges that necessitate a restructuring.”
The company is collaborating with PricewaterhouseCoopers (PwC) to develop this restructuring plan. Lewis added, “We have a clear strategy to transform the business for long-term sustainability. While recent improvements in our fashion offerings and in-store experience have delivered encouraging results, a restructuring is essential to secure River Island’s future as a profitable retailer.”
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The planned closures may sadly result in some job losses, though the company intends to minimize this impact. River Island currently employs approximately 5,500 staff members.
The retailer’s 2023 annual report revealed a loss of £33.2 million, citing fast-evolving customer preferences and intense competition, especially from online platforms, as critical challenges. The report highlighted the impact of ongoing geopolitical tensions, supply chain disruptions, and rising inflation, which have squeezed consumer spending power and confidence.
Originally launched under the Lewis and Chelsea Girl brands, River Island underwent rebranding in the 1980s and has since faced mounting pressures from digital competitors like Shein. Sales declined by 19% in 2023, reflecting the broader struggles of high street fashion chains.
The proposed restructuring plan, which will be subject to votes by the retailer’s creditors in August, aims to secure new funding to support River Island’s turnaround efforts and adapt to the changing retail landscape.