Claire’s and The Original Factory Shop go into administration putting 2,500 jobs at risk

Well-known retail chains Claire’s and The Original Factory Shop (TOFS) are being put into administration - with more than 2,500 jobs at risk.

The move came after owner of the retailers, Modella Capital, said “last-ditch” measures to rescue the high-street favourites had fallen through.

Most signifcant is TOFS with branches in Sleaford, Horncastle, Spilsby, Mablethorpe, Skegness and Spalding. Claire’s have shops in Skegness, Lincoln and Spalding.

Last year, the two brands underwent restructuring amid fears over their future with investment firm Modella Capital stepping in to save them. But now, Modella said it had made the “tough decision” to kickstart insolvency proceedings for the businesses. It means 1,355 employees in the UK and Ireland employed at 154 Claire’s shops will be at risk, as well as 1,220 staff at 140 TOFS’ outlets.

Court records show that a notice of intention to appoint an administrator was filed in relation to both chains on Monday afternoon (January 5), with a spokesman for Modella saying: “We have worked intensively in an effort to save both businesses, having made last-ditch attempts to rescue them, but neither has a realistic possibility of trading profitably again.

“In these circumstances, administration is the only option. In both cases, the legacy effects of trading prior to our ownership left them highly vulnerable.”

They said tough retail conditions, including from government policies, were causing British businesses to “suffer”, adding: “The climate on the high street remains extremely challenging, and TOFS and Claire’s are not alone in experiencing difficulties.

“A combination of very weak consumer confidence, highly adverse government fiscal policies, and continued cost inflation, is causing many established and much-loved businesses to suffer badly. It’s a simple fact that if retailers can’t make money, they risk having to close, and jobs across the country are lost.”

There has been concern among retailers about the government's moves to increase wages and National Insurance contribution, on top of rising energy and materials costs

Modella bought more than 150 Claire’s shops last year, but 145 were not included in the deal, leading to their closure, after the accessories chain had appointed administrators for its UK and Ireland business after filing for bankruptcy in the US. TOFS, a discount department store chain, was sold to the investment firm in February.

Modella has become a significant force in the British retail industry, having bought WH Smith’s high street chain last year and taking over arts and crafts retailer Hobbycraft in 2024.