The Original Factory Shop Shuts Down All Locations Following Administration
The Original Factory Shop, a well-known discount department store chain, has permanently closed all 137 of its retail outlets along with its Bolton head office after the company was placed into administration. This move comes amid growing concerns over weak consumer confidence and challenging economic conditions in the retail sector.
Administration and Staff Impact
Administrators from Interpath confirmed on Thursday that every Original Factory Shop location is now shut for good. When the retailer entered administration, it employed 1,180 people. The vast majority of these employees have been made redundant, with only a small number retained temporarily to assist in winding down operations. A specialist team has been established to support affected staff in filing claims through the Redundancy Payments Service.
A spokesperson for Interpath stated: "A phased closure of the store portfolio was implemented considering the financial position. The majority of employees have been made redundant, while a small number of staff have been retained to assist the joint administrators in their duties as they move towards formally winding up the business."
Modella Capital's Role and Broader Retail Struggles
The Original Factory Shop was placed into administration earlier this year alongside Claire's Accessories, both under the ownership of private equity firm Modella Capital. Modella has attributed the collapse of these businesses to sluggish consumer confidence and what it describes as "adverse government fiscal policies." The firm has been actively winding down both operations.
Modella Capital, which rebranded from Tailer Debtco in 2023 and is owned by the Hay Wain Group, has a history of acquiring high street retailers only to offload them shortly after. Both Claire's and The Original Factory Shop were placed into administration less than two years after Modella purchased them. According to its most recent balance sheet, Modella held £12.8 million in net assets in 2024.
Recent Acquisitions and Ongoing Challenges
Modella Capital recently acquired WH Smith's high street branches, rebranding them as TG Jones. However, these sites have reportedly struggled with poor sales. The firm has privately acknowledged that sales have been hampered by the low name recognition of the TG Jones brand, with outlets still using the WH Smith fascia outperforming those that have been rebranded.
Additionally, Modella's agreement with WH Smith includes a clause that prevents the closure of underperforming shops within 12 months of the takeover. The investment company has also brought in emergency advisors to lead a comprehensive restructuring of TG Jones following its £76 million acquisition of the 480-store chain from WH Smith last year.
In other developments, Modella is reportedly considering a sale of Wynsors World of Shoes, a northern footwear retailer it acquired just four months ago, highlighting its pattern of rapid turnover in retail investments.
Background on The Original Factory Shop
Established in 1969, The Original Factory Shop moved its headquarters from Burnley to Bolton last year. The retailer offered a diverse range of products, including fashion, homeware, toys, and personal care items. Its closure marks the end of a longstanding presence in the UK discount retail market, reflecting broader pressures facing the industry.
