Northern Ireland’s four BHS department stores are under threat of closure, putting 300 jobs at risk, after the company went into administration.
The biggest retail failure since Woolworths went bust in 2008 could also impact negatively on suppliers and surrounding businesses as well as direct employees.
A total of 11,000 jobs across 164 shops are at risk throughout the UK if a suitable buyer for the business can not be found.
BHS (British Home Stores) has debts of more than £1.3 billion, including a pension fund deficit of £571 million, which proved a major stumbling block in last-ditch rescue talks over the weekend.
The company has four local stores in Belfast, Holywood, Newtownabbey and Lisburn.
Northern Ireland Independent Retail Trade Association (NIIRTA) representative Glyn Roberts said: “This is a sad day for the retail sector and the high street as a whole.
“The potential closure of the four local BHS stores will not just have an impact on their staff but also result in less footfall for surrounding retailers”.
The NIIRTA chief executive added: “Change is the only constant in retail and it does seem that BHS did not keep up with the marketplace and the expectations of 21st century consumers.
“Our thoughts are with their staff and families at this difficult time.”
BHS was bought last year by a consortium called Retail Acquisitions, headed by Dominic Chappell, for £1 from retail entrepreneur Sir Philip Green, the owner of the Arcadia retail empire.
Rival retailer Sports Direct is understood to want some of BHS’s 164 stores, but will only do so if it does not have to take on any pension liabilities.
Sir Philip – who bought BHS for £200m in 2000 – is reported to have offered £80m towards the cost of BHS pensions, though the regulator could still pursue further payment from the retail billionaire.
Administrators Duff & Phelps said: “Property sales have not materialised as expected in both number and value.
“Consequently, as a result of a lower-than-expected cash balance, the group is very unlikely to meet all contractual payments.
“The directors therefore have no alternative but to put the group into administration to protect it for all creditors.”
It added that BHS would continue to trade as usual while potential buyers are sought out.
The company’s owner, Dominic Chappell, said he will continue to work with the administrators to “find a solution post the administration”.
Speaking to the Press Association, Mr Chappell said: “No one is to blame. It was a combination of bad trading and not being able to raise enough money from the property portfolio.
“In the end, we just couldn’t reach an agreement with Arcadia over pensions.”
In an urgent statement to the House of Commons last night, Business Minister Anna Soubry said there are no plans to make immediate redundancies.
“The clear message is that BHS is still open for business as usual. There are no plans for immediate redundancies or store closures,” she told MPs.