Debenhams is slashing another 2,500 jobs across its department stores and warehouses as the U.K.-based high street chain continues to cut costs in the wake of a bankruptcy process that has left no choice but to put itself up for sale to prevent total liquidation.
Prior to the upcoming staffing purge, Debenhams employed 14,500. In what would be the elimination of approximately 6,500 jobs so far this year, the ailing clothing chain is set to shed one-third of its original workforce.
“The trading environment is clearly a long way from returning to normal and we have to ensure our store costs are aligned with realistic expectations,” Debenhams said in a statement. “Such difficult decisions are being taken by many retailers right now, and we will continue to take all necessary steps to give Debenhams every chance of a viable future.”
The report indicated that staff affected by the job cuts had been informed, In particular, the company said a management restructuring process would account for some of the job losses, including scrapping a sales manager, visual merchandise manager and selling support manager roles.
No new stores are slated to close. This year, Debenhams has permanently closed 20 of the stores it temporarily shuttered as COVID-19 spread. The retailer has since reopened 124 stores across the U.K., noting that business is “trading ahead of expectations.”
The 242-year-old retailer has been in quite a rut in recent years, having fallen into insolvency three times, and twice in the past year. The COVID-19 pandemic essentially forced Debenhams to shut down its operations in Ireland, cutting 1,200 jobs shortly after the company entered a “light touch” administration—the U.K.’s equivalency to bankruptcy in the U.S.—in April. Debenhams announced plans to reopen all 15 stores in Scotland by July 13.
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Investment bank Lazard was appointed to oversee the sale process and hopes to secure a buyer for Debenhams before the end of September. Frasers Group, which owns Sports Direct and House of Fraser, is reportedly interested in scooping up 30 stores. Frasers owner, billionaire Mike Ashley, sought to complete a takeover of Debenhams last year but lost out to a consortium of the group’s lenders.
Thousands of job cuts have swept across a multitude of U.K. high street retailers, including DW Sports and M&Co, both of which recently filed for administration, with the former closing all 75 stores. The cuts extend far and wide to fashion retailers including Debenhams’ direct competitors Marks & Spencer and John Lewis, as well as River Island, Harrods, T.M. Lewin, Topshop owner Arcadia Group, Ted Baker and Selfridges, among other big names to announce redundancies.
The U.K.’s Centre for Retail Research said that by June 29, 25 percent of the retail stores that had been open before COVID-19 have not yet resumed operations. Through the end of June, job losses totaled 49,790, with store closures at 3,607. The center’s forecast for the year calls for store closures to reach 20,620, and job losses to rise to 235,704.
The job cuts and store closures have coincided with a who’s who of fashion retailers that have fallen into administration in the U.K. since the COVID-19 pandemic spread worldwide, including Victoria’s Secret U.K., Laura Ashley, Cath Kidston, Diane von Furstenberg’s DVF Studio, JD Sports’ Go Outdoors, Monsoon, Accessorize and T.M. Lewin.