The Original Factory Shop, a discount homeware chain, has entered administration, putting approximately 1,180 jobs at risk across its 137 stores. Administrators from Interpath have been appointed to assess options for the business, which will continue trading on high streets for now.
Owner Modella Capital, which acquired the chain less than a year ago, attributed the collapse to weak consumer confidence, adverse government fiscal policies, and continued cost inflation. The company stated that the business had no realistic prospect of trading profitably again, partly due to legacy issues from prior ownership.
Interpath cited challenging trading conditions driven by high-cost inflation, fragile consumer confidence, and government policies increasing employment costs. Problems with a third-party warehouse and distribution partner exacerbated these issues. Joint administrator Rick Harrison noted that The Original Factory Shop had long been a cornerstone of local high streets.
The chain reported a pre-tax loss of £5.6 million for the year to March 2024, with sales falling 1% to £117.5 million. The administration follows a restructuring six months ago that moved its head office and distribution centre from Burnley to Bolton and secured rent cuts on several stores.
The collapse adds to a difficult period for UK retail, with Game Retail also filing a notice of intention to appoint administrators and Claire's accessories chain entering administration earlier this week, affecting 1,350 jobs.
