08 October 2023 , 21:16
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A major chain ever-present in UK shopping centres could undergo a major rebranding that could change the face of the high street as we know it, its boss has said.
Department store House of Fraser, which boasts 33 locations across the UK, currently employs more than 17,000 people across the country. But Michael Murray, the chief executive of parent company Frasers Group’, has recently described House of Fraser as a 'broken business' – and hinted at a major change potentially coming to all its stores.
The company appears to have been struggling for a while, as 20 House of Frasers have shut up shop since billionaire business tycoon Mike Ashley bought it out of administration five years ago. Mr Murray said the group's strategy was to distance itself from the traditional business model of operating department stores, but admitted that even after making changes, "House of Fraser" as we know it may cease to exist.
CEO Mike Ashley said it's a 'broken business' (PA)He told the Telegraph: "House of Fraser was a broken business when we bought it. We’ve completely changed the operating model. It was mostly concession, the stores were way too big, they were under-invested.
“Our future vision is that House of Fraser will diminish and Frasers will grow. We’ve just been obsessing over really building what Frasers should be and working towards that answer."
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Mr Murray added that most department stores could take the same turnover out of half the space. It comes as Frasers Group has seen pre-tax profits almost double over the past year, as it made £660.7million in the year to the end of April 2023. This compares to £335.6million the previous year.
The group has seen annual sales rise by 15.8 per cent to £5.6billion. Company bosses have credited the success to the group's 'breadth of brands', which now includes Sports Direct, Jack Wills, GAME and USC. If House of Fraser were to cease operating it would be the latest blow to Britain's high streets, as the likes of Wilko, Boots, Clintons and Iceland have all announced a significant amount of closures this year alongside Argos, M&S and The Works.
The last 41 Wilko stores closed on Sunday after the company announced it was going into administration at the start of August, meaning the company, which has struggled since the start of the Covid pandemic, has now disappeared entirely from UK's towns and cities, resulting in thousands of redundancies.