2,500 jobs at risk as administration looms for Mothercare UK

Baby products retailer latest to fall foul of Britain’s high street woe, despite healthy global operations

Mothercare in administration                                 

Mothercare, the baby products retailer is set to appoint administrators for its loss-making British business.

Sales have dropped significantly at Mothercare UK in recent years after increasing competition from supermarket groups and online giants such as Amazon.

In a statement the global Mothercare company said: “The company is unable to continue to satisfy the ongoing cash needs of Mothercare UK.”

The company has been able to stave off full administration for ten days thanks to notices of intent to appoint administrators. However this appears to be a short-term measure.

Mothercare’s share price has fallen by 29 per cent to trade £8.00, down from £10.20, in mid-afternoon trading.

Mothercare’s troubles are in keeping with the wider decline of the British high street, with footfall declining, running costs increasing and customers moving online. It could follow in the footsteps of House of Fraser, British Home Stores and Toys R Us.

According to the British Retail Consortium, the UK retail sector lost 106,000 jobs from March 2016 to 2019. If Mothercare UK enters into administration 2,500 further jobs and 79 shops would be at risk.

Internationally the company is seemingly healthy, with over 1000 outlets in more than 40 countries. Whereas Mothercare UK lost £36.3m in the year to March 2019, the global brand generated £28.3m in profit.

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