Claire’s and TOFS near administration, 2,500 jobs at risk

Accessories chain Claire’s and discount retailer The Original Factory Shop (TOFS) are reportedly close to entering administration, putting about 2,500 jobs at risk, according to Sky News.

The two retailers are understood to be preparing to file notices of intention to appoint administrators shortly after the end of the key Christmas trading period. The move would give them temporary protection from creditors while options are assessed.

Between them, Claire’s and The Original Factory Shop trade from just over 300 stores across the UK. Both businesses are owned by investment firm Modella Capital, which acquired them in separate rescue deals last year.

Modella bought The Original Factory Shop after it came close to collapse and acquired Claire’s following an earlier administration process. Despite emergency restructurings, sources revealed the retailers’ current operating models were no longer viable.

People familiar with the situation told Sky that higher taxes on retailers and pressure from landlords to reclaim stores had intensified the challenges facing both chains. Britain’s retail sector has been under sustained strain as costs rise and consumer spending remains subdued.

Interpath Advisory, which oversaw a company voluntary arrangement for The Original Factory Shop after Modella’s takeover, is expected to handle its administration, while Kroll is expected to oversee Claire’s, according to Sky News sources. Administrators are likely to continue trading while seeking buyers.

The difficulties come amid a wider downturn for retailers. Data from Sensormatic Solutions showed that footfall on 23 December 2025, the last full shopping day before Christmas, fell 13.1% year-on-year.

Rising payroll costs have hit small and medium-sized retailers particularly hard, prompting warnings of further failures this year. In 2025, chains including Poundland and River Island turned to restructuring processes to avoid collapse.

Modella also owns Hobbycraft and the former WH Smith high street estate, which it has rebranded as TG Jones.

At The Original Factory Shop, a move to a new third-party logistics provider following last year’s acquisition is understood to have contributed to its difficulties. Claire’s was affected by the loss of its largest concession partner after Modella’s takeover.

Claire’s US parent filed for bankruptcy protection last year and was later sold, with the new owner granting Modella a licence to operate the UK business. The retailer, once operating nearly 300 UK stores, has also been affected by shifts in spending habits among its core teenage customer base. Job losses were already made during restructuring processes before Modella acquired the business.

A spokesperson for Modella Capital told Retail Sector: “Very sadly, we have had to initiate insolvency proceedings for The Original Factory Shop (TOFS) and Claire’s Accessories UK & Ireland. This has been a very tough decision. We have worked intensively in an effort to save both businesses, having made last-ditch attempts to rescue them, but neither has a realistic possibility of trading profitably again. In these circumstances, Administration is the only option. In both cases, the legacy effects of trading prior to our ownership left them highly vulnerable.

“The climate on the High Street remains extremely challenging, and TOFS and Claire’s are not alone in experiencing difficulties. This is borne out by recent Sensormatic statistics and other data sources suggesting an alarming drop-off in pre-Christmas footfall. A combination of very weak consumer confidence, highly adverse government fiscal policies and continued cost inflation is causing many established and much-loved businesses to suffer badly. It’s a simple fact that if retailers can’t make money, they risk having to close – and jobs across the country are lost.”