Update on high street fashion chain with 109 branches that could close a third of shops
A STRUGGLING fashion chain has been forced to exit the stock market following reports it could close stores.
The women's clothing retailer de-listed from London’s junior AIM stock market on Thursday morning.
Quiz currently has 62 stores and 47 concessions in the UK but may be forced to shut shops to secure its future.
The firm announced plans to de-list from the stock market shortly before Christmas as it attempts to cut costs.
Earlier this month shareholders voted in favour of de-listing the company.
The fashion chain last year warned that it would run out of cash unless it manages to quickly secure more funding.
Read more on shops closing
The news will come as a blow to the chain’s 1,500 employees, some of whom now face being made redundant.
The company said its sales had been “disappointing” in the Christmas trading period and its cash reserves were “less than previously anticipated”.
It warned that the poor trading was partially down to the “impact of inflationary pressures on consumer confidence and spending”.
The company has called in advisors to look at ways it could free up cash or secure more funding to help guarantee its future.
Chairman Peter Cowgill said the company must “substantially reduce” costs, which has increased speculation it may need to shutter shops.
It has previously been reported that Quiz is preparing to close up to a third of its stores to help slash costs.
It is understood that the company has not yet made any decision on whether it will proceed with closures or undergo major restructuring.
It has reportedly called in restructuring experts at Teneo to help the business look at options.
It could go into a pre-pack administration or company voluntary arrangement (CVA) restructuring to enable closures.
A CVA allows firms to look at ways to save the business, such as reducing rent rates with landlords or closing stores.
Why are retailers closing shops?
EMPTY shops have become an eyesore on many British high streets and are often symbolic of a town centre’s decline.
The Sun's business editor Ashley Armstrong explains why so many retailers are shutting their doors.
In many cases, retailers are shutting stores because they are no longer the money-makers they once were because of the rise of online shopping.
Falling store sales and rising staff costs have made it even more expensive for shops to stay open.
The British Retail Consortium has predicted that the Treasury's hike to employer NICs from April 2025, will cost the retail sector £2.3billion.
At the same time, the minimum wage will rise to £12.21 an hour from April, and the minimum wage for people aged 18-20 will rise to £10 an hour, an increase of £1.40.
In some cases, retailers are shutting a store and reopening a new shop at the other end of a high street to reflect how a town has changed.
The problem is that when a big shop closes, footfall falls across the local high street, which puts more shops at risk of closing.
Retail parks are increasingly popular with shoppers, who want to be able to get easy, free parking at a time when local councils have hiked parking charges in towns.
Many retailers including Next and Marks & Spencer have been shutting stores on the high street and taking bigger stores in better-performing retail parks instead.
In some cases, stores have been shut when a retailer goes bust, as in the case of Carpetright, Debenhams, Dorothy Perkins, Paperchase, Ted Baker, The Body Shop, Topshop and Wilko to name a few.
What's increasingly common is when a chain goes bust a rival retailer or private equity firm snaps up the intellectual property rights so they can own the brand and sell it online.
They may go on to open a handful of stores if there is customer demand, but there are rarely ever as many stores or in the same places.
The Centre for Retail Research (CRR) has warned that around 17,350 retail sites are expected to shut down this year.
Meanwhile, pre-pack is an insolvency process for a business to sell its assets before it appoints administrators.
It is a way to sell a business to a third-party buyer.
The business has already gone through one restructuring in 2020 and renegotiated its rents at a time when lockdowns damaged retailers.
It has already shut 240 stores since it first floated on the stock market in 2017.
At the time it made founders the Ramzan family £90million.
The Glasgow-based fashion chain de-listed from the London Stock Exchange last month to cut costs and engineer a full turnaround of the business.
Advisers at Interpath are now trying to work out how to solve the crisis at the firm.
Execs have already taken out a £1million loan from chief executive Sheraz Ramzan's father, Tarak, in a desperate attempt to save the chain last summer.
Quiz revealed it made a loss of nearly £7million last year.
It only took home £2.3million in profit the previous year.
HSBC is now understood to be cautious about pumping more cash into the company.
What other retailers have been forced to close stores?
ShoeZone was one of the first retailers to blame the Budget for store closures.
In her statement, Chancellor Rachel Reeves announced that the Government is hiking employer National Insurance Contributions (NICs) and the National Living Wage.
This will increase the cost for businesses, who have already struggled to attract customers during the cost of living crisis.
ShoeZone has begun to close "unviable" branches after its costs increased.
It said: "These additional costs have resulted in the planned closure of a number of stores that have now become unviable."
Meanwhile, WHSmith has confirmed it will close 18 shops for good in the coming months.
The retailer is focusing on the travel side of its business, where sales are growing.
In an update this year to investors the company said it is on track to open 15 stores this year, with a further 15 to follow "each year over the medium term".
The company said it will be moving away from its high-street stores and has no plans to open any more.
Meanwhile, Homebase will close 13 stores this month after it fell into administration in November.
The company will shutter shops in Cheltenham, Coventry, Romford and Wolverhampton.
CDS, which owns The Range and the Wilko brand has stepped in and said it will take over 70 Homebase locations.
Meanwhile, rival DIY chain B&Q has agreed to buy five former Homebase locations.
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It means dozens of stores are still at risk of closure.
Some former Homebase stores will open as hybrid branches which will combine the shop with Wilko and The Range brands.
RETAIL PAIN IN 2025
The British Retail Consortium has predicted that the Treasury's hike to employer NICs will cost the retail sector £2.3billion.
Research by the British Chambers of Commerce shows that more than half of companies plan to raise prices by early April.
A survey of more than 4,800 firms found that 55% expect prices to increase in the next three months, up from 39% in a similar poll conducted in the latter half of 2024.
Three-quarters of companies cited the cost of employing people as their primary financial pressure.
The Centre for Retail Research (CRR) has also warned that around 17,350 retail sites are expected to shut down this year.
It comes on the back of a tough 2024, when 13,000 shops closed their doors for good—already a 28% increase on the previous year.
Professor Joshua Bamfield, director of the CRR said: "The results for 2024 show that although the outcomes for store closures overall were not as poor as in either 2020 or 2022, they are still disconcerting, with worse set to come in 2025."
Professor Bamfield has also warned of a bleak outlook for 2025, predicting that as many as 202,000 jobs could be lost in the sector.
"By increasing both the costs of running stores and the costs on each consumer's household it is highly likely that we will see retail job losses eclipse the height of the pandemic in 2020."
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