The Belgian branch of fashion brand Esprit, Esprit Belgium Retail N.V. (BEBR), has joined its counterpart in filing for bankruptcy with an insolvency court in Belgium on 8 April, Esprit Holdings Limited announced in a press release. The news comes a few weeks after the fashion brand’s Swiss arm collapsed.
The bankruptcy will only affect the Belgian branch, having no direct impact on Esprit operations in other countries. The decision in Belgium comes as part of an extensive reorganisation at Esprit Holdings Limited, a process it initiated after reporting an increase in its loss for FY23 from 642 million Hong Kong dollars to 2.5 billion Hong Kong dollars.
Esprit noted it was in the process of strengthening its business with wholesale and franchise partners, as well as generating new momentum in e-commerce. “The bankruptcy of BEBR and the closure of the shops is inevitable,” it said, adding that 15 stores owned by the parent company are to close immediately. As a result, 148 employees will lose their jobs.
15 stores to close
Independent operators, meanwhile, of which there are around 10 in total, will continue to operate as normal under the Esprit banner, Esprit confirmed, while the brand’s collection will remain available at 543 multi-brand stores.
Esprit is struggling in the face of a general economic slowdown combined with sharply rising logistics and energy costs. European consumer reluctance is also playing a role, alongside high rent prices. “It is not financially feasible to continue retail operations in their current structure in Belgium,” Esprit explained. The company stressed that the decision was “taken in the best interest of the group”.
Esprit added that the closure in Belgium will have no direct negative material impact on the parent company, and reiterated that it continues to consider all restructuring options and contingency plans “to preserve the value of the group’s business”.
The Esprit bankruptcy in Belgium comes two weeks after the company closed its doors in Switzerland, where bankruptcy had also been declared. The same week further saw news that Esprit was closing around 40 shops in Germany as its contract with German franchise operator PTH Group expired.
This article originally appeared on FashionUnited.NL. Translation and edit by: Rachel Douglass.