Young fashion retailer New Look is to shut down its Chinese operations, including all 120 stores it operates across the country.
Around 730 employees in China will be made redundant as a result of the decision, with ”a small number” of UK roles also impacted.
The loss-making retailer will withdraw from the market to focus instead on domestic operations.
It is thought that property services company CBRE has been appointed to find new tenants for the Chinese New Look stores. New Look has been gradually reducing its Chinese store portfolio, and intends to close the remaining 120 stores by the end of December 2018. It will also close its Shanghai-based head office.
In a statement, New Look said that despite significant investment in the Chinese market, performance was below expectations, and did not warrant continued investment in the market. A strategic review of New Look’s other overseas markets is ongoing.
Alistair McGeorge, executive chairman at New Look, said: “Having reviewed the trading performance of our business in China and the substantial investment required to continue operations in the market, we have made the difficult decision to exit our stores in China.
”Our priority will be to support all affected staff during this time. As our turnaround plans continue, we remain focused on ensuring that New Look is well positioned to drive strong business performance and profitable growth.”
The retailer filed for a company voluntary arrangement (CVA) in March, which proposed the closure of 60 UK stores. It is thought that the retailer has already closed shops in France, Belgium and Poland.
New Look made an annual operating loss of £152.5m for the year to 24 March 2018, compared with a £76.4m operating profit the year before.
However, McGeorge has reported signs of a turnaround and a rise in underlying operating profit of 19% to £14.4m in the 13 weeks to 23 June 2018.