Following the news that Claire’s is on the edge of collapse as it appoints administrators in the UK and Ireland; Emily Salter, lead retail analyst at GlobalData, offers her view: “Claire’s has lost relevance in recent years as the market for accessories targeted at children and teenagers has shrunk, with the tastes of many teenagers aligning with that of adults. This has manifested in teenagers seeking more classic styles and switching to retailers targeting all ages, from those at the value end of the market like Primark to more premium players such as Astrid & Miyu, with teenagers trading up to more longer-lasting pieces. Influencer culture and social media has been key to this, with young consumers being exposed to the same fashion trends as adults.
“Claire’s has also been one of the victims of the meteoric rise of Shein. For those who want to purchase accessories more tailored to younger consumers, Shein offers a huge amount of choice and lower prices, while Claire’s stores will feel outdated to digitally native Gen Alpha shoppers. Shein also has the upper hand in being more able to keep up with trends that young consumers see on social media.”
Michael Lynch, partner at city law firm DMH Stallard and insolvency and restructuring specialist, said: “Given that Claire’s in the US filed for bankruptcy in the US, it comes as little surprise that Claire’s UK business is also in distress.
“Stakeholders and lenders have presumably exhausted viable refinance and solvent restructuring options.
“Should Claire’s enter administration, and dependent on the purpose of the administration, the administrators could sell the underlying company as a going concern or sell its business and assets, thereby saving potential job losses.
“The recent press release of an impending collapse, with a quote from prospective insolvency practitioners will allow interested parties to engage in any sale process.”
