Hundreds of jobs at risk as more retailers struggle

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The Independent Online

Further signs of the intense pressure facing high street retailers on both sides of the Channel emerged yesterday, as thousands of retail staff face the new year without a job.

In the UK, 69 of the 120 London head office staff at Zavvi, the entertainment retailer that collapsed into administration last week, were made redundant yesterday. The redundancies came just as Zavvi's Irish business, which was initially unaffected by the failure of its parent on Christmas Eve, went into provisional liquidation.

Meanwhile, it emerged that Jonathan James, the 50-store discount shoe retailer and wholesaler, is likely to close some stores in a restructuring. Store staff said the retailer had changed owners. It is unclear if Jonathan James is set to go through, or has already completed, a pre-pack administration. The retailer declined to answer questions.

In other developments, Mothercare, the baby and maternity retailer, said it was unaffected by the collapse of Olan Mills Photography, the operator of photo studios. Olan Mills Photography, which had 25 of its 34 branches in Mothercare stores, ceased trading on Boxing Day. Separately, Stylo, the company behind the Barratts and Priceless shoe chains, has vehemently denied it is working with the re-structuring team at accountants KPMG.

Michael Ziff, Stylo's chairman and chief executive, said: "We have a working relationship with their [KPMG's] corporate department." Earlier this month, Stylo said trading for the four weeks since 31 October had "been below its expectations". The company made a loss of £9.3m for the six months ended 2 August. KPMG declined to comment.

In France, the women's clothing firm Morgan fell into administration, raising fears over 1,000 jobs. Morgan, in which the private equity firm Apax has a 40 per cent stake, has 575 stores across 57 countries. Earlier this year, the retailer closed its retail operation in the UK to focus on its wholesale business on these shores.

Morgan – which is labouring under debts of an estimated €30m (£29.3m) and expects sales to be down 8 per cent this year – hopes to find a new owner. It also emerged this week that Chanel, the luxury fashion chain, is to lay off 200 of its Paris staff. Chanel, which employs 16,000 fixed and temporary workers worldwide, is the latest luxury retailer to suffer from well-heeled customers tightening their purse strings.