Key Takeaways
- High Court approves River Island store closures plan, averting collapse.
- 4,000 jobs saved, but over 1,000 remain at risk.
- 33 stores to shut immediately; 70 more under review.
- £40 million family funding supports the restructuring.
- Legal precedent could influence other UK retailers’ survival strategies.
LONDON — River Island store closures have been approved in a High Court rescue plan that will safeguard more than 4,000 jobs while leaving over 1,000 roles in jeopardy. The decision marks a pivotal moment for the high street fashion chain, which will shut 33 of its 230 stores as part of a sweeping restructuring.
The ruling, delivered Friday, followed majority creditor backing earlier in the week. Without the plan, the family-owned company warned it could run out of cash by the end of August, risking collapse.
“This decision gives us a strong platform to deliver our transformation strategy,” Chief Executive Ben Lewis said, adding that the closures will allow River Island to “align our store estate to our customers’ needs.”
River Island Store Closures: High Court Approves Rescue Plan
The restructuring will cut fixed costs by closing underperforming stores and securing rent reductions from landlords. Another 70 sites are under review for possible closure, highlighting the depth of change needed to adapt to consumer demand for online shopping.
Resistance from some landlords — fewer than 75% backed the deal — underscores strain in the retail property market. Vacancy rates have surged as brands from Topshop to Oasis abandoned physical stores for online-only models.
Financial Strain Behind the River Island Store Closures
Founded in the 1940s as Lewis’s, River Island posted a £33.2 million loss in 2023 after sales fell 19% to £578.1 million. The company had reported a £2 million profit the prior year.
The Lewis family, which controls the business, will inject £40 million through its investment vehicle to support the restructuring. Without the plan, management warned, the retailer would face insolvency by year-end.
Why the River Island Store Closures Could Reshape the High Street
Retail analysts say the High Court’s willingness to approve the deal despite landlord opposition could encourage other struggling retailers — including Poundland, Claire’s, and Hobbycraft — to pursue similar cost-cutting measures.
The closures reflect a broader shift as shoppers gravitate toward online players such as Shein and Temu, which benefit from tax advantages on imported goods shipped directly to consumers.
What’s Next After the River Island Store Closures?
While the store closures will trim overhead, River Island must still navigate intense competition, high operating costs, and evolving consumer preferences. Success may depend on retooling its supply chain, strengthening its online platform, and preserving the brand loyalty that has kept it a high street fixture for decades.
