New Look, a UK-based global fashion retailer is on the verge of shutting down 60 stores in the UK and slash 1,000 jobs to reinstate the brand back to profitability. In a press release, the retailer stated the move has been undertaken after creditors approved a company voluntary agreement (CVA).
To attain this, the stores will shut down in one year, which will in turn help to reduce store rents on an average of 15-55% across its other 393 stores. Along with this, some of the employees will also be redeployed.
Alistair McGeorge, Executive Chairman of New Look, said: “In order to help restore long-term profitability, it is clear we need to reduce our fixed cost base. We are pleased to have gained the support of our creditors to address our over-rented store estate. Launching a CVA has been a tough decision and our priority remains keeping all potentially affected colleagues informed during this difficult time.
“The CVA is one of a number of necessary actions we are taking to get the company back on track. In addition to implementing other cost-saving initiatives, we are already focusing on driving future full price sales by realigning our pricing to offer significantly better value, adding flexibility to our buying model, and improving our speed to market. Additionally, we have further strengthened our alignment between e-commerce and stores.
“New Look is a great brand and today represents another important step in helping to rebuild our position within the UK market.”