Downfall of another British high street icon... House of Fraser to shut half its stores

‘Why come into town now?’

HOUSE of Fraser will almost disappear from traditional high streets after announcing the closure of half its stores.

About 6,000 jobs are at risk as 31 shops shut early next near, including its flagship Oxford Street store as it tries to satisfy creditors and avoid a complete collapse.

Those that are closing are largely in town centres which have been hit by falling customer numbers and rising rents. Outlets that have avoided the chop are in more modern shopping malls.

It is another sign of the last-ditch battle for survival by long-established names as the rise of internet shopping ravages the British High Street.

Chief executive Alex Williamson said: ‘The business has faced a tsunami of changing dynamics.

‘This is brutal, this is as tough as it gets. We’ve not taken this decision lightly.

‘It’s very dramatic for people we care about a great deal, I find it personally very emotional, and I’m not making this decision based on anything other than what I consider to be the best option for House of Fraser.’

The company owns 59 stores with 4.4million sq ft of retail space and as shopper numbers have dwindled, the cost of power and renting the firm’s often elegant Victorian buildings has become prohibitively high.

Business rate rises have also taken their toll, with the Oxford Street store alone now paying £4.3million a year.

Shoppers due to lose their stores reacted with shock yesterday.

One woman in Darlington, where House of Fraser is axing the Binns department store, said: ‘What are people going to come into town for? Nothing.’

In Shrewsbury, shopper Ruth Brown told her local paper that she had worked at the town’s closing store 13 years earlier.

She said: ‘It is a bit of a shame, I’ll be sad to see it go, some of the staff have been there for decades.

‘Who’s going to go in there after House of Fraser goes?’

The shops at risk, many of which have been department stores for more than a century, will shut next year if the proposals are backed by House of Fraser’s creditors.

The business is in negotiations about a so-called company voluntary agreement, which will give it more time to pay back debts in exchange for restructuring.

It must win approval from creditors owed at least 75 per cent of the company’s debt at a meeting on June 22.

Sources said that if the rescue deal fails the company will plunge into administration. If it goes ahead, it will unlock a £70million investment from Chinese company C.banner which would buy 51 per cent of the company from current owner Sanpower Group, another Chinese business.

Sanpower bought the retailer in 2014 and has since been dogged by accusations it has failed to invest in the business. It pumped £30million into the 169-year- old chain in the past year, but a string of senior staff have quit in the past few years amid fears that it doesn’t have a viable future.

This is the latest big-name blow to the British high street which is facing crisis as chains increasingly are shutting stores to focus on online sales.

Budget retailer Poundworld revealed on the same day it is heading into administration, putting 5,300 jobs at risk. The retail sector is Britain’s biggest employer with 4.6million working in the industry.

But in recent years as shoppers move online, jobs have been put as risk with New Look and Marks and Spencer announcing store closures this year and Maplin and Toys R Us closing altogether.