Embattled retailer Claire’s has warned managers of its UK stores to expect bailiffs turning up to recover unpaid debts, Retail Week understands.
A source close to the business told Retail Week that store managers were instructed last week to expect bailiffs turning up and demanding cash from the tills or stock in lieue of debt repayments. The staff were told to refuse any requests by debt enforcement officers, and instead to contact senior management immediately.
The source also said that store managers were informed that Claire’s would no longer be accepting gift cards as payment from customers and that staff would need to have their hours pre-approved by managers for the rest of the month.
“Morale among the staff was already very low,” added the source. “So, talk of bailiffs potentially showing up to stores and having to get weekly hours approved ahead of time didn’t improve matters much”.
The threat of landlords sending bailiffs to Claire’s stores over unpaid rents and concerns over whether the retailer can afford to pay post-dated rents represents a deepening of the crisis engulfing the business.
Last week, the US-based fashion chain filed for bankruptcy in the US on Wednesday. It was reported at the time that the US bankruptcy wouldn’t impact on the brand’s UK 230-strong store portfolio.
The brand has estimated assets and liabilities each between $1bn and $10bn and between 25,001 and 50,000 creditors.
It had been reported that Claire’s was struggling to find a buyer for its UK high street business, which has made losses of £25m over the last three years and a £4.7m loss in the year to March 2024.
Sky News had previously reported that Lakeland owner Hilco Capital had been interested in buying the UK business, after Claire’s Accessories’ owners Elliot Management and Monarch Alternative Capital had bought Interpath Advisory on board to help find a buyer.
Retail Week understands that Interpath Advisory is still exploring options for the UK business and that a resolution could be expected as soon as the end of the week.
The UK arm of the business faces a December 2026 deadline to pay back a £355m loan.
The retailer operates 2,750 stores across 17 countries in North America and Europe. This is the second time it has declared bankruptcy, having last done so in 2018. Claire’s had operated as many as 370 UK stores at the time, but closed over 100 after it defaulted on a loan repayment.
A retail property source said that landlords typically only begin sending bailiffs to retail occupants as a last resort, when the tenant has failed to pay their rent and other avenues for recovering debt have already been exhausted.
Bailiffs can be sent by a landlord as part of a Commercial Rent Arrears Recovery (CRAR) legal process to seize tenant’s goods and sell them to recover unpaid rent. Landlords may also be able to forfeit leases or pursue court action to recover debt from tenants.
Claire’s has been contacted for a comment.
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