Burton could be about to lose one of its major men's fashion stores after creditors agreed to proposals which could see 60 New Look close across the country.
New Look Menswear, in Coopers Square shopping centre, in the town, has been identified as one of the stores facing the chop as bosses need to find ways to cut costs.
It has been announced that a Company Voluntary Arrangement proposal, a means for struggling companies to pay off all or part of their debts over an agreed timescale, which was launched on March 7, 2018, has been approved by the overwhelming majority of the New Look's creditors and landlords, with 98 per cent of votes in favour of the proposal.
The arrangement was launched to improve the operational performance of the company by reducing its UK store costs amid "challenged trading performance and a difficult retail environment".
It will deliver material annual cost savings for the company. New Look has identified 60 out of its 593 stores in the UK for potential closure, including the menswear store in Burton, alongside a further six sites which are sub-let to third parties. Final decisions on individual store closures will be made by the company and the stores' respective landlords. The women's New Look store, which is opposite the men's in Cooper's Square is not affected.
Under the terms of the agreement, the stores identified for potential closure are most likely to close within six to 12 months' time subject to decisions by landlords.
Alistair McGeorge, executive chairman of New Look, said: "In order to help restore long-term profitability, it is clear we need to reduce our fixed cost base. We are therefore pleased to have gained the support of our creditors to address our over-rented store estate. Launching a Company Voluntary Arrangement has been a tough decision and our priority remains keeping all potentially affected colleagues informed during this difficult time.
"The Company Voluntary Arrangement is one of a number of necessary actions we are taking to get the company back on track. In addition to implementing other cost-saving initiatives, we are already focusing on driving future full price sales by realigning our pricing to offer significantly better value, adding flexibility to our buying model, and improving our speed to market. Additionally, we have further strengthened our alignment between ecommerce and stores.
"New Look is a great brand and today represents another important step in helping to rebuild our position within the UK market."
The menswear section of New Look in Burton used to be in the main store, also in Coopers Square shopping centre, before it was opened in the new branch almost directly opposite 18 months ago and employs around seven people.
The announcement comes after sex toys and lingerie shop Ann Summers closed its doors in the shopping centre for good last month, saying it would be concentrating on its larger outlets.
Other stores facing an uncertain future
Carpetright is the latest retailer to announce it is closing stores and putting jobs under threat.
The flooring retailer, which has an outlet at Centrum East Retail Park, in Wellington Road, Burton, is planning to restructure and bring in extra cash to keep operating.
Bosses at Carpetright blamed the previous leadership for opening too many stores in the wrong places and paying rents that were too high.
The business is looking to draw up a company voluntary arrangement. If the plan fails, hundreds of jobs would be in serious jeopardy.
If it succeeds, Carpetright would be able to close underperforming stores and negotiate with landlords to secure lower rents.
Carpetright's Company Voluntary Arrangement would result in between £40 million and £60 million of shares, the cash raised would help pay debts and rebuild the business.
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The group, which has 409 UK shops, has already agreed a £12.5 million unsecured loan from major shareholder Meditor to help with "short-term working capital requirements".
Carpetright chief executive Wilf Walsh said it would be "business as usual" for the flooring firm's stores during Easter and it would remain in "close contact" with staff over its restructuring plans.
He said: "I am pleased that we have secured this additional support from one of our major shareholders as we continue to explore the feasibility of a Company Voluntary Arrangement and a conditional equity issue.
"These further cash resources will enable us to make the necessary decisions free from short-term funding pressure.
"The aggressive store opening strategy pursued by the company's previous leadership has left Carpetright burdened with an oversized property estate consisting of too many poorly located stores on rents which are simply unsustainable."
B&Q owner Kingfisher PLC has also reported that profits dropped last year as its ambitious transformation plan led to gaps on its shelves and economic uncertainty weighed on sales, according to the Telegraph.
The FTSE 100 retailer, which also owns Screwfix which has branches in Burton and Ashby, revealed a 10 per cent drop in pre-tax profits to £682 million for the year to January on revenues up 3.8 per cent to £11.7 billion.
