Retailer New Look is to close its Irish shops, with almost 350 staff expected to be made redundant, after the fashion group said the business was “no longer viable”.
It comes as another retailer – Scottish-based Quiz – announced five of the 23 shops it is closing are in Ireland with the loss of 54 jobs.
New Look, which has appointed Shane McCarthy and Cormac O’Connor of KPMG Ireland as provisional liquidators to oversee the winding down of the business, has 26 stores in the Republic of Ireland.
The business, built up over more than 20 years, employs 347 people, of whom 32 are full-time. New Look said the shops would remain closed for the next few days, reopening on Sunday to begin a clearance sale.
Quiz, which fell into administration in the UK, said it was shutting 23 of its 65 stores across Britain and Ireland. Outlets in The Square, Tallaght, Newbridge’s Whitewater Shopping Centre and the Athlone Town Centre shopping centre are among those listed for closure as are stores in Derry’s Richmond shopping centre and the Erneside Shopping Centre in Enniskillen.
The company said the closures would results in 54 job losses – 36 in the Republic and 18 in Northern Ireland.
According to its website, the retailer will continue to operate a shop in Newry and concessions at stores in Mullingar, Portlaoise, Carlow and Drogheda.
Staff at both groups have already been notified of the situation, with New Look employees receiving a letter from the company inviting them to a meeting and outlining the next steps. A 30-day consultation period is to commence over coming days.
“Regrettably, a collective redundancy process, impacting all colleagues in the ROI is also envisaged,” New Look, which has amassed debts of €17.7 million according to their latest accounts, said in a statement.
In a High Court hearing on Thursday seeking the liquidators’ appointment, Mr Justice Brian Cregan was told New Look Retailers (Ireland) Limited had built up debts to such an extent that its UK-based parent company was withdrawing financial support and provisional liquidators were now required due to the “substantial” debt.
Barrister John Lavelle told Mr Justice Cregan the company had experienced financial challenges such as the pressure of the cost of living, staff costs and consumer spending moving online.
The company had, in 2020, petitioned to have an examiner appointed, which was resisted by their various landlords, but it did eventually agree rent reductions for “most stores”.
Counsel said the company was, as of last month, “heavily insolvent” and had a liability of €15.6 million to the UK parent company, New Look (UK) Ltd.
Mr Lavelle said the Irish branch had made a loss in each for the last four years and the company, which entered the Irish market in 2003, was “no longer viable”.
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The retailer said the Irish operation had “struggled” for some years, hit by supply chain, costs and the ongoing squeeze on consumer spending. It said the decision to appoint liquidators was not taken lightly.
“Due to the increasingly volatile trading conditions, we needed to expedite our existing plans, which included conducting a review of our operations in the Republic of Ireland,” a spokesperson for the company said.
“Following this review, the group regrettably concluded it was no longer viable to continue trading here, so it has made the difficult but necessary decision to enter liquidation in this market.”
The retailer will now focus on its UK business and its digital sales.
Arnold Dillon, director of Retail Ireland, a unit of business lobby group Ibec, said the closures were down to spiralling costs and labour pressures.
“The last couple of years have been extremely difficult for many retailers,” he said. “Consumer confidence and retail sales have been weak due to heightened cost concern. At the same time costs have spiralled.
“Labour costs in particular have grown rapidly, threatening the viability of many retail businesses. The government has promised new measures to ease the burden, but we need to see action that makes a real difference.”
