Endemic retail conditions have triggered another death on the British high street as fashion brands Oasis and Warehouse file for administration, seeing a loss of 200 jobs.
The two well known high street fashion brands are seeking advisory help from financial firm Deloitte as they plunge into administration.
Oasis and warehouse LTD, which is a company owned by Icelandic lender Kaupthing, could see 1,800 jobs at risk while 200 have been lost indefinitely.
The fashion brand currently has 92 standalone stores and more than 400 concessions in department stores including Selfridges and House of Fraser, (which are currently shut in compliance with the Government’s lockdown measures due to the coronavirus crisis.)
The fall of this once fashion favourite is not an unusual occurrence in the increasingly volatile retail market.
Legacy department store Debenhams has also filed for administration, a move that was (supposedly) already in the works before COVID-19. However, lockdown laws was the final death knell that triggered the department store’s final closure, with rumours suggesting the outlets may not open after lockdown laws lifted.
Dr Gordon Fletcher of the University of Salford Business School explores the reasons behind these closures below…
“As high street fashion retailers, Oasis and Warehouse have been squeezed from multiple directions in the last few years. The successful rise of online fashion retailers, such as Boohoo, that can bring fast fashion to customers even faster is a well-documented and significant challenge.
“The fact that Boohoo had also previously rescued competing traditional outlets Coast and Karen Millen made that squeeze even tighter. Being controlled by the troubled Icelandic bank Kaupthing is a further underlying structural issue that has made that squeeze feel even tighter.
“The current health emergency has brought another unexpected pressure. Despite its name, fast fashion does have long lead times and supply chains that stretch around the world. This form of operation still brings containers of clothing to warehouses but now without the opportunity to put the goods in front of consumers. With no footfall on the high street, the single distinguishing feature between the high street and online retailers has instantly disappeared.
“COVID-19 is not the sole cause for this most recent administration announcements. However, the health situation is accelerating negative changes in the business world with its impact being felt in terms of weeks rather than months. Unfortunately, while many businesses are pivoting to new business models, any positive improvements will take longer to be realised.”
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