Discount Chain Faces Administration; 137 Stores at Risk – Full List Inside

Rowan Ashford

Published: January 29, 2026 10:29 AM ET

Discount Chain Faces Administration; 137 Stores at Risk – Full List Inside

An iconic discount retailer, The Original Factory Shop (TOFS), faces a potential shutdown as it enters administration. With 139 locations at risk of closure, the company is undertaking a major stock sale, offering discounts between 50% and 70%. This dire situation follows TOFS’s filing for administration late last year, impacting all 160 stores across the UK.

Background and Company Struggles

The Original Factory Shop’s recent troubles arose after its owner, Modella Capital, announced unsuccessful attempts to rescue the business. Approximately 2,500 employees from TOFS and Claire’s, another retailer under Modella’s portfolio, are now at risk of redundancy. TOFS employs around 1,220 staff across its branches, while Claire’s has 1,355 employees at its 154 outlets in the UK and Ireland.

Reasons for Administration

The decision to enter administration stems from a series of challenging retail conditions. Factors contributing to this situation include:

High cost inflation
Weak consumer confidence
Increasing labor costs due to government policies

These challenges have left TOFS and similar businesses struggling to maintain profitability. A spokesperson for Modella Capital indicated that legacy trading issues further complicated the outlook for both retailers.

Impact on the Retail Environment

Modella Capital highlighted broader issues within the UK retail landscape. The firm stated that many beloved brands are experiencing severe difficulties, often leading to significant job losses. The combined effects of poor consumer confidence and harsh fiscal policies have led to a perilous environment for retailers.