It has been a challenging week for Britain with the ‘Beast From The East’ storm coming from the East and now Storm Emma coming from the West. It has dropped snow across much of the country, closed schools, businesses, public transport and much more.
As much as Britain’s unpreparedness for snow makes it a laughing stock to our American and Canadian cousins it has also been a very tough week for high street retail, with both Toys R Us UK and Maplin entering administration yesterday.
Toys R Us
News of the U.S. entity being in trouble surfaced in September 2017 and it was unclear how this would effect the UK business.
Well that has now been made clearer as on the 28th February Toys R Us UK entered administration and “An orderly wind down” has begun as they have failed to find a buyer.
This is another clear high street casualty where the failure to adapt to customer expectations and the growing online dominance has been another scalp for the online eCommerce crowd.
“Toys R Us has fallen foul of a perfect storm hitting bricks-and-mortar retailers across the board…Rising costs from the National Living Wage, apprenticeship levy and inflation, combined with ongoing pressure on consumer spending and the continued rise of the internet are hitting retailers with a big High Street presence hard.” Julie Palmer, Regional Managing Partner, Begbies Traynor
I personally did visit my local Toys R Us store a few months ago, and I can honestly say that the experience was disappointing. For a store who’s target audience is children and new parents the whole experience felt bland, boring and far from interactive.
For a place whose motto used to be “It’s a Magical Place…” the 2018 reality was actually far from that.
Just a few hours after the Toys R Us announcement came the news that Maplin would also be entering administration as they too had also failed to secure a buyer to take them on.
Maplin has 217 stores across Great Britain and over 2,300 staff. PwC who have been appointed as administrators have announced that all staff and stores will remain unaffected for the time being whilst they explore all opportunities to find a new owner.
“The challenging conditions in the UK retail sector are well documented…Like many other retailers, Maplin has been hit hard by a slowdown in consumer spending and more expensive imports as the pound has weakened,” Zelf Hussain, Joint Administrator and Partner, PwC
If no buyers can be found for either Maplin or Toys R Us, this will result in a closing of 222 combined stores and just under 5000 jobs lost.
What are your thoughts on the continuing struggles of the high street and their failure to adapt to the pressure of online retailers? Head over to our Facebook Discussion Group or use the comments section below.