The Original Factory Shop has collapsed into administration.
Rick Harrison and James Clark from Interpath were appointed joint administrators to The Factory Shop Limited, trading as The Original Factory Shop, today.
The joint administrators will continue to trade all 137 stores as a going concern while they ‘assess options’ for the business. The company’s online shop, however, will close immediately.
Administrators said The Original Factory Shop had experienced challenging trading conditions, driven by high cost inflation, fragile consumer confidence and ‘Government policies which have led to significant increases in employment costs’.
Rick Harrison, managing director at Interpath and joint administrator, said: ‘The Original Factory Shop has long-been a cornerstone of local high streets up and down the country.
‘Unfortunately, however, trading challenges have impacted the business such that the Company had to be placed into administration.
Tough times: The Original Factory Shop is understood to be on the brink of falling into administration this week
‘Over the coming weeks, we will be working closely with TOFS dedicated team of employees as we endeavour to operate all stores as a going concern while we assess options for the business.’
No details of potential job cuts have been provided, but the retailer employs nearly 1,200 staff.
All goods purchased before 28 January 2026 can be exchanged for goods to the same value or less when accompanied by proof of purchase in line with the stores’ returns policy, the firm’s administrators said.
And all goods purchased on or after 28 January 2026 will be ‘sold as seen’, with returns only accepted on the grounds that the goods are faulty.
The Original Factory Shop has 130 shops across Britain and currently has steep discounts available across its online store.
Modella filed a notice of intention to appoint administrators for The Original Factory Shop earlier this month.
The private equity firm has been holding talks with third parties about a sale of the business during the last few weeks. Industry insiders remain doubtful that a purchaser for any significant portion of the retailer will crop up.
The chain was already teetering on the brink of failure when Modella Capital acquired it last year.
A toxic cocktail of grim government policies, landlords’ demands to take back many of The Original Factory Shops’ better sites and a poorly handled transition to a new logistics provider have impacted the retailer’s financial performance.
The company’s latest accounts are, according to Companies House, overdue, and should have been published by 31 December 2025.
The Original Factory Shop first opened its doors in the late 1960s, establishing itself as a fixture on British high streets for more than five decades. It sells an array of products, including electrical goods, beauty products and homewares.
The Original Factory Shop is the second major retailer owned by Modella to collapse this week.
On Monday, Claire’s, the accessories retailer, collapsed into administration just four months after its last brush with insolvency, putting more than 1,000 high street jobs at risk.
Insolvency practitioners from Kroll were formally appointed as administrators to Claire’s UK and Ireland on Monday and around 150 of the chain’s shops are being closed.
Demise: On Monday, Claire’s, the accessories retailer, collapsed into administration
Claire’s, which garnered a cult following thanks to its ear-piercing services and friendship bracelets, was purchased by Modella last year in a last-minute rescue deal.
Founded in 1961 in Chicago before heading to the UK in the mid-90s, visits to Claire’s became a rite of passage for teenagers, with their stores boasting a slew of glittery plastic earrings, necklaces, rings, keychains, and hats.
A spokesman for Modella previously said: ‘Very sadly, we have had to initiate insolvency proceedings for The Original Factory Shop (TOFS) and Claire’s Accessories UK & Ireland.
‘This has been a very tough decision. We have worked intensively in an effort to save both businesses, having made last-ditch attempts to rescue them, but neither has a realistic possibility of trading profitably again.
‘In these circumstances, administration is the only option. In both cases, the legacy effects of trading prior to our ownership left them highly vulnerable.
‘The climate on the high street remains extremely challenging and TOFS and Claire’s are not alone in experiencing difficulties.
‘This is borne out by recent Sensormatic statistics and other data sources suggesting an alarming drop-off in pre-Christmas footfall.
‘A combination of very weak consumer confidence, highly adverse government fiscal policies and continued cost inflation is causing many established and much-loved businesses to suffer badly.
‘It’s a simple fact that if retailers can’t make money, they risk having to close – and jobs across the country are lost.’
Modella also owns WH Smith’s historic high street estate, which it has rebranded as TG Jones, as well as Hobbycraft.
In April 2025, Hobbycraft, acquired by Modella in August 2024, announced plans to shut at least nine stores across the UK in a move affecting up to 126 jobs as part of a restructure.
At the same time, Hobbycraft said the restructuring would also result in redundancies across its Bournemouth head office and distribution centre in Burton-on-Trent.
On Wednesday, the assets of fashion retailer LK Bennett were acquired out of administration, having filed a notice of intention to appoint administrators last month.
Restructuring and investment firm Gordon Brothers has now acquired the global LK Bennett brand and related intellectual property assets from the joint administrators of LK Bennett Fashion Ltd.
In 2019, LK Bennett collapsed into administration after its owners failed to pin down a new financial backer.
The level of turmoil across the retail sector is stark, with businesses facing rising costs and wages, as well as shifting consumer habits, tax changes and a tidal wave of online-based rivals.
This is Money has contacted Modella for comment.
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