Update 5th January 2026
For the second time Claire’s has filed an intention to appoint administrators and the owner Modella Capital has also done the same for the Original Factory Shop. This puts 2500 jobs at risk and is another blow to jobs in the High Street. Modella Capital bought the chain out of administration only in September 2025. In a statement Modella said there had been a huge drop off in trade and that administration was the only option.
—————————-
It has been reported that Claire’s, the fashion accessories chain, has filed an intention to appoint administrators at the court today. Interpath have been lined up to try and rescue the company, the move puts 2,150 jobs at risk.
The company has 278 shops in the UK and 28 in Ireland but has been struggling with falling sales and fierce competition. The US arm of the company has already gone into Chapter 11 bankruptcy protection.
Claire’s said all outlets will continue trading while administrators at Interpath said they will “assess options for the company” once appointed.
Mr Cramer, the chief executive, said: “This decision, while difficult, is part of our broader effort to protect the long-term value of Claire’s across all markets.”
Mr Wright at Interpath said: “Over the coming weeks, we will endeavour to continue to operate all stores as a going concern for as long as we can, while we assess options for the company.”
The UK chain sits as part of the Claire’s empire, which stems from a base in a suburb of Chicago, Illinois.
Claire’s French business, which has 239 stores, was forced to call in receivers last month.
As such, it isn’t really a UK specific problem. The main issue has been that the teenagers and “tweens” who have been the bedrock of Claire’s customer base worldwide now buy their “accessories” online, via influencers and from the likes of Temu and Shein.
Many retailers have used CVAs to try and reduce costs but in the case of Claire’s the problems were probably too deep and the benefit of exiting a few leases or reducing rents was not going to be enough.
A loan of £355m is due to be paid back in December 2026 and it is likely that the lenders ( who are secured so not bound by a CVA ) felt that time was up. The last 3 years the company has lost £25m and turnover has fallen to £137m
As Claire’s enters formal insolvency, stakeholders often face significant uncertainty. Here is a breakdown of the legal framework and what it means for those affected.
Administration is a powerful statutory process governed by the Insolvency Act 1986. It is triggered when a company is insolvent and can no longer meet its debts. An independent Licensed Insolvency Practitioner (IP) is appointed to take control from the directors. A key feature is the statutory moratorium—a legal “shield” that instantly stops all legal actions, such as winding-up petitions or bailiff visits, providing the “breathing space” needed to rescue the business or achieve a better result for creditors than immediate closure.
The law dictates a strict hierarchy for the distribution of funds. Fixed charge holders (typically banks with security over property) are paid first. Once the administrator’s fees are covered, preferential creditors are next; this includes employees (for specific arrears) and HMRC for taxes like VAT and PAYE. Following these are floating charge holders, and finally, unsecured creditors—which include trade suppliers and customers—who are at the back of the queue and frequently receive only a small fraction of their debt.
Entering administration does not mean all jobs are instantly lost. For the first 14 days, the administrator assesses the company’s viability and may make redundancies. If a member of staff is kept on past this 14-day window, the administrator “adopts” their contract, meaning their ongoing wages and rights become a priority expense. Those made redundant can claim for unpaid wages and notice pay via the Redundancy Payments Service if the company has insufficient assets to cover these costs.
Suppliers and customers are generally unsecured creditors. Suppliers should stop granting credit under old agreements and negotiate “pro-forma” (upfront) terms for any new supply to the administrator. For customers, deposits and gift cards are rarely honoured. However, those who paid over £100 via credit card may be protected under Section 75 of the Consumer Credit Act and should contact their bank immediately to initiate a claim.
Written ByRobert Moore
Marketing Manager
Rob has over two decades of experience in web and general marketing. He has extensive knowledge of the Insolvency sector and has helped many worried directors with their questions.
Rob is now working with the Board at RMT to develop strategic marketing programmes to support the business plan and drive more company rescues.
Employee Rights in Administration – Guide for worried employees
Employee Rights in Administration – Guide for worried employeesWhat Happens To Your Pension If A Company Goes Administration?
What Happens To Your Pension If A Company Goes Administration?