The Body Shop closes half of British stores, paths abroad diverge

Through the relaunch of its British branch, The Body Shop would be able to keep about half of its shops open. The other half is to close, and almost half of all jobs at the head office will disappear.

Franchise and wholesale

The receivers of the bankrupt chain hope that they will be able to keep open more than half of the 198 shops in the United Kingdom, but the remaining branches on the chain’s home market will close in various stages. Seven shops are already closing today, including four in London – as that is where rents and costs are highest.

Administrator FRP claims that years of unprofitability means that “following a full evaluation of The Body Shop’s UK business”, it had no option but to decide that “the current store portfolio mix is no longer viable“, RetailGazette reports. The company does stress that franchise and wholesale partners will be a “cornerstone of future success”.

40 % of jobs will disappear at the head office, as FRP wants to move towards a simplified company with a “more nimble, financially viable model”. The focus will be more on products, online sales channels and wholesale, which should make The Body Shop more competitive again with its competitors – and more financially stable.

Tense wait for foreign branches

There was no mention of the foreign operations, so the fate of the countries that Alma24 is not taking over (such as the Netherlands and France) remains unclear at the moment. While they still depend on the British parent company, they claim that communication with FRP has halted. Given the administrator’s statement on franchising, there is a chance that the retailer will try to spin off as many shops as possible.

Meanwhile, German fund Alma24 is buying the operations in Austria, Belgium, Germany and Luxembourg – subject to a judicial reorganisation, trade magazine LSA reports. The Belgian and Luxembourg branches are reportedly in receivership and a thorough reorganisation may follow.

Deliveries halted

France and the Netherlands are not part of the acquisition: there is no insolvency yet, but the retailer would no longer receive deliveries from its bankrupt British parent company. Partly as a result, The Body Shop was forced to take its webshop offline. A spokeswoman did tell RTL Z that the 27 Dutch shops would remain open for the time being.

The fate of the stores that are not part of the acquisition, will now depend of the development of the British bankruptcy. At the moment, all ten European subsidiaries are operating at a loss, LSA reports.