(qlmbusinessnews.com . Sat 9th Aug, 2025) London, UK —
River Island's Strategic Overhaul: 33 Stores Closing in Response to Online Shopping Surge
River Island has been granted permission by the High Court to implement significant changes across its UK stores, including the closure of 33 outlets, as part of the company's recovery strategy. The esteemed high street label cited a notable shift in consumer behaviour towards online transactions and escalating operational expenses as primary factors for its financial downturns.
The fashion giant had previously alerted its creditors to a potential liquidity crisis by late August if its restructuring proposals failed to secure approval. The endorsed plan will not only see the closure of select stores but will also enforce rent reductions at 71 additional locations, a move Ben Lewis, the CEO of River Island, believes will tailor the company's retail footprint to meet evolving shopper preferences.
Immediate discussions with the affected landlords are slated to commence promptly.
In an effort to further curtail expenditures, River Island will enforce around 110 redundancies within its head office, which houses approximately 950 staff members, potentially saving the company £8.1 million. Currently, River Island operates 223 stores in the UK and Ireland, with the latter spared from the recent closure announcements.
Earlier in the year, the retailer had already shuttered seven of its loss-making locations, as shared by River Island’s counsel, Matthew Weaver KC, during the High Court hearing. Weaver highlighted the stark choice between restructuring and insolvency facing the company.
CEO Mr Lewis outlined a robust strategy for turning the company’s fortunes around, indicating that the court’s approval offers a substantial foundation for future prosperity.
Amid challenges familiar to many British retailers, such as the digital shift in shopping and escalating costs inflated by hikes in employer National Insurance Contributions, River Island has struggled to keep pace with the rapid changes in consumer preferences, according to Bloomberg intelligence analyst Charles Allen. However, Allen points out the distinctive challenge faced by River Island in failing to captivate customers with appealing merchandise.
The retailer’s trajectory has been declining, with recent accounts disclosing a £33.2 million loss after sales plummeted by 19%. The proposed restructuring is seen as a pivotal move to stave off debt crises and secure essential funding, with Weaver acknowledging the brand's financial struggles.
Nick Sherrard of consultancy Label Sessions commented on the necessity for River Island to rejuvenate its brand appeal post-restructuring. He critically noted the disparity between being a recognisable brand and a genuinely cherished one, urging the company to redefine its vision beyond mere cost reductions.
The extensive restructuring will commence with the closures in January 2026, alongside rent renegotiations potentially reducing charges to zero in some instances. The long-term forecast for River Island projects a modest annual growth of 1% over the next five years.
Among the UK locations set for closure are stores in Aylesbury, Edinburgh Princes Street, Falkirk, and many others, marking a significant downsizing for the brand that has been a familiar presence on the high street since its rebranding in 1988.
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