The future of The Original Factory Shop will be decided in 20 days time with the fate of half its stores in doubt.
Owner Modella Capital is looking for major rent cuts while looking to return to more opportunistic buying.
It wants to renegotiate rents at 88 of the 178 stores as part of a company voluntary arrangement (CVA), according to Sky News.
About 1,000 jobs are at risk depending on the outcome of the creditors’ vote on 14 May, including among 176 head office and warehouse employees in Burnley.
‘In response to the challenging retail environment of the last year, The Original Factory Shop (TOFS) has today announced a proposed Company Voluntary Arrangement (CVA) in order to protect the future of TOFS as a business and to allow it to flourish in the future,’ says a statement.
;Under TOFS’ plan, which will be subject to a vote by the company’s creditors on May 14, TOFS will adjust its store estate (by, where possible, renegotiating the leases on a number of its stores that are loss-making), return to the deal-centric stock and purchasing strategy it is famous for, invest in online channels, and realign its support centre and logistics operations.
‘There will be no change in the day-to-day running of the business while this plan is implemented, and management will keep all TOFS colleagues updated as the process continues. While these changes are necessary, TOFS remains committed to serving our loyal customers across the UK.
‘Our plan aims to put the business on sustainable footing, protecting as many jobs as possible, and allowing us to return to offering the exceptional value and deals our customers expect from us.’
