At Simple Liquidation, we see many well-known businesses reach a crossroads, a moment when decisive action is needed to protect jobs, preserve value, and prevent a full collapse. The recent restructuring of River Island is one such example.
The high street fashion retailer, famous for its trendy styles and long history, has just secured approval for a rescue plan that will save over 4,000 jobs. But the cost is significant: 33 stores will close immediately, more than 1,000 jobs remain at risk, and a further 70 sites may shut in the future.
While River Island will live to fight another day, the case carries important lessons for any retail business navigating the turbulent waters of UK high street trading.
What Happened at River Island?
River Island’s restructuring didn’t happen overnight. Like many high street brands, the company faced a sharp rise in the cost of doing business, from increased wages to soaring energy bills. Add to that the shift in consumer behaviour with more shoppers heading online and fewer visiting physical stores, and the cracks began to show.
By June 2025, the company was warning creditors it could run out of cash by the end of August without a rescue deal. Losses had mounted to £33.2 million in 2023, compared to a small profit the year before, and sales had dropped by nearly 20%.
The solution? A court-approved restructuring plan involving:
- Closing 33 of its 230 stores immediately.
- Cutting rent payments across the store portfolio.
- Securing £40 million in funding from the founding Lewis family.
- Lining up further transformation plans to align stores with customer needs.
The plan passed despite fewer than 75% of landlords backing it, a sign of how tough negotiations can be when multiple creditor groups have competing interests.
Lesson 1: Act Early – Don’t Wait Until the Cash Runs Out
One of the most striking parts of River Island’s story is the tight timescale. The retailer made it clear: without approval, it would be insolvent within weeks.
At Simple Liquidation, we always advise directors not to wait until they’re right on the brink. Acting early gives you more options:
- You can consider a Company Voluntary Arrangement (CVA) or restructuring plan, rather than moving straight to liquidation.
- You have time to negotiate with landlords, suppliers, and lenders from a position of strength.
- You can avoid wrongful trading risks that can lead to personal liability for directors.
Lesson 2: The Shift to Online Shopping is Here to Stay
River Island’s situation highlights a hard truth: the UK high street is no longer the default shopping destination. Online competitors like Shein and Temu are drawing customers away with low prices, fast delivery, and huge product ranges, often benefiting from tax advantages.
For retailers with a large physical footprint, this means store portfolios must be constantly reviewed. Are all locations profitable? Are some draining resources? Can the rent terms be improved?
If the answer is no, closing underperforming stores before losses spiral is far better than keeping them open out of sentimentality.
Lesson 3: Restructuring Can Be a Lifeline – But It’s Not Easy
Restructuring isn’t just about cutting costs. It’s a complex legal and financial process requiring creditor approval, court sanction, and a clear business plan for the future.
River Island’s plan is notable for its scope and ambition, but it’s also a reminder that not all creditors will be on your side. In this case, fewer than 75% of landlords supported the rent cuts, but the court approved the deal in the interests of saving the company.
For smaller businesses, restructuring might involve:
- Renegotiating supplier contracts.
- Restructuring debt repayments.
- Closing loss-making divisions.
- Entering a formal insolvency procedure like a CVA.
At Simple Liquidation, we can advise on whether restructuring is viable and, crucially, when liquidation might be the safer, cleaner exit.
Lesson 4: Funding and Support Are Critical
Without the £40 million from the Lewis family, River Island’s rescue would have been far less likely. Many struggling retailers don’t have a supportive shareholder with deep pockets, which makes outside investment, asset sales, or alternative financing essential.
For directors, this means being open to:
- Bringing in new investors.
- Selling non-core assets.
- Merging with or selling parts of the business.
If funding isn’t available and losses are unsustainable, liquidation may be the most responsible step. We’ve helped hundreds of directors make that decision without fear or stigma.
Lesson 5: Protecting Jobs Is a Powerful Motivator – But Not at All Costs
River Island’s plan has saved thousands of jobs, but also accepted that over 1,000 roles will go. In difficult times, directors often face the painful reality that saving part of the business is better than losing it all.
When liquidation becomes necessary, our role at Simple Liquidation includes:
- Ensuring employees receive all entitlements through the Redundancy Payments Service.
- Communicating clearly and compassionately with staff.
- Handling creditor claims so directors can focus on moving forward.
What If You’re a Retail Director in Trouble?
If you recognise some of River Island’s challenges in your own business, falling footfall, rising costs, mounting debts, now is the time to act.
Here’s what you should do:
- Review your finances honestly – know exactly where you stand.
- Seek professional insolvency advice immediately– this is where we step in.
- Engage with creditors early– it’s far better to approach them with a plan than wait for demands.
- Consider all options – restructuring, CVA, or liquidation.
How Simple Liquidation Can Help
We are not brokers. We are not middlemen. We are licensed insolvency practitioners with over 30 years’ experience, authorised by the Insolvency Practitioners Association and the Institute of Chartered Accountants in England and Wales.
Our directors, Jamie Playford FABRP MIPA and Alex Dunton MABRP, along with our skilled team, handle every case directly. Whether your company is solvent and you want a cost-effective closure, or insolvent and you need to protect yourself from trading illegally, we have the knowledge and empathy to guide you through it.
We’ve helped hundreds of businesses from small independents to large chains navigate closures, restructures, and voluntary liquidations. We take the stress off your shoulders, deal with creditors on your behalf, and ensure you meet your legal duties.
Final Word
River Island’s restructuring shows that with decisive action, funding, and a realistic plan, even a struggling retailer can secure its future. But it also shows the dangers of waiting too long; the company came perilously close to insolvency.
If you’re a retail director reading this and wondering how long your business can hold on, don’t delay. Whether you need to explore restructuring options or take the difficult but clean route of liquidation, Simple Liquidation is here to help you make the right decision for your business, your staff, and yourself.
Call us today for a confidential, no-obligation discussion, and let’s find the right way forward together.