Thousands of jobs to go as UK retail chains rationalise operations
13 June 2018
Retail chain store House of Fraser (HoF) has announced plans to close 31 of the 59 department stores it operates throughout the UK. The closures mean the loss of jobs of 2,000 employees directly employed by HoF, with a further 4,000 workers employed by in-store concessions under threat. It also plans to close a depot in Milton Keynes operated by an outside contractor. Included in stores slated to be closed by next year is its flagship shop on Oxford Street in central London.
HoF’s announcement came the same week as budget retailer Poundworld filed an intention to appoint administrators—a legal step just short of liquidation—putting the jobs of its 7,000 workers in jeopardy.
HoF began as a single drapers (cloth and clothing) store in Glasgow in 1849 when it was owned by Hugh Fraser and James Arthur. In the 1950s, it was still owned by the Fraser family and began to expand its chain of shops, including acquiring London’s luxury Harrods department store. In 1985, the chain was bought by the Egyptian businessman Mohamed Al-Fayed. In 2014, the House of Fraser chain was sold to the Chinese Nanjing Xinjiekou Department Store Co.
HoF currently employs 5,000 directly with 12,500 concession staff depending on it for employment. Its annual sales figure is over £1 billion, but it faces rising costs, especially rent and business rates and losses of £44 million last year—after shop sales fell by 2.9 percent and online sales by 7.5 percent. The current owners plan to sell the business as part of a restructuring deal.
Chinese fashion conglomerate C.banner, based in Nanjing, plans to buy a 51 percent stake in HoF. However, C.banner is only prepared to go ahead if a company voluntary…