Debenhams administrators have decided to “wind down” the business, after JD Sports walked away from takeover talks affecting 12,000 jobs along with the supply chain.
The company’s administrators have announced that they will start the process of winding down Debenhams UK, which runs 124 stores, while still looking for offers for all or parts of the business.
Dr Gordon Fletcher, retail expert from the University of Salford Business School, says structural issues at the heart of the UK high street are to blame.
Dr Fletcher said: “Today’s announcement of Debenhams winding down is the first ripple in the aftermath of the Arcadia announcement yesterday. This is a ripple that starts with the concessions that Arcadia’s brands have in Debenhams stores, extends to the general uncertainty in high street retail and has then brought a moment of reflection within JD Sports and its decision to prop up the struggling department store chain.
“Today’s announcement reconfirms what has long been known. The UK high street is increasingly a fragile house of cards that suffers from a concentration of ownership, insufficient investment to keep pace with online developments and a general lack of dynamism and engagement between brands and consumers.
“This decision affects the 200 year old chains 124 outlets and 12,000 employees across the country. It is a closure of the chain that mirrors the complete failure of Woolworths over ten years ago. The parallels are important too. As a department store retailer the spaces that will be left on the high street are large and will be impossible to fill like for like.
“For high streets across the UK the prospect of more plywood hoardings where once there were window dressings is a grim and unappealing offering to already jaded consumers.”