Fashion brand Ted Baker has announced it’s closing its remaining 31 stores across the UK and the Republic of Ireland over the coming weeks, putting over 500 jobs at risk, after it fell into administration in March this year.
Reacting to the news, Nick Drewe, retail expert and founder of online discount platform Wethrift, provides insight into a ‘perfect storm’ of situations that he believes led to the brand’s decline.
“Ted Baker is part of a growing line of British retailers to collapse during the turbulent economic crisis and is yet another blow to the already fragile UK high street.
“Authentic Brands Group, the parent company that purchased the Ted Baker brand 18 months ago, has attributed losses to the ‘significant arrears’ that were acquired under the holding company No Ordinary Designer Label (NODL).
“Despite the brand’s current situation being partly due to high levels of arrears described as ‘too difficult to overcome’, Ted Baker must also acknowledge alternative factors that have contributed to its decline over recent years.
“The brand has faced significant instability over the last 5 years. Its founder, Ray Kelvin, resigned as chief executive in 2019 following allegations of inappropriate behaviour towards staff, which gained huge amounts of unwanted attention and publicity.
“Following this, the retailer faced significant profit warnings, which were closely followed by the negative impact of the COVID-19 pandemic, placing significant financial strain across the business.
“As well as internal issues with leadership and the impact of the pandemic, the brand has also failed to recognise the shift in consumer demand and spending amidst the ongoing cost of living crisis.
“Plenty of fashion brands that are at a high price point have struggled to compete during these challenging financial times, as consumers look to cut down on luxury spending and prioritise saving and budgeting.
“Alongside the implications of its high price point, the brand has also faced plenty of criticism in terms of its inability to move with the times, with critics citing Ted Baker’s products as looking ‘outdated’ and ‘drab’ in comparison to more popular and current brands.
“Failure to modernise designs in line with contemporary trends has undoubtedly contributed to the undoing of the brand, leading to significant losses.
Nick adds: “It has certainly been a challenging period for premium fashion brands in the UK, and the situation is not looking likely to improve anytime soon, as brands struggle to compete with a reduction in consumer spending.
“Unfortunately, I doubt it will be too long before we see more retailers in the space experience the same fate as Ted Baker.”
