Hotter Shoes plans to close stores as lockdown bites

Hotter Shoes has started a formal consultation with staff at its Skelmersdale head office which could lead to a "number of redundancies", it said.

The company said it plans to restructure through a company voluntary arrangement (CVA).

The business was working on a restructuring programme to shift focus to a direct marketing model, but said it has been forced to bring it forward much quicker by the coronavirus crisis.

The business is owned by private equity firm Electra which said in a statement that the management of Hotter has been in discussions with a number of its retail landlords. This was to seek agreement to reduce the number of stores to a level and cost that allows Hotter to remain viable.

It said individual discussions have been unsuccessful in obtaining the required level of agreement to allow Hotter to continue on a viable basis.

Due to this, it said Hotter will be entering into a CVA process in the coming days. If the CVA proposal is approved and successfully implemented, it will leave a trading estate of 15 shops.

The firm was founded in 1959 as a slipper manufacturer and is understood to employ around 1,200 people and has in excess of three million customers.

Neil Johnson, Electra Private Equity PLC Chairman, said: "Before the pandemic hit, Hotter, under new Chief Executive Ian Watson, was making good progress to accelerate the implementation of a digitisation strategy to return it to its direct marketing routes.

"The need for these actions has been intensified by the consequences of the past 3 months of lockdown. If successful, the proposed CVA will result in fewer stores, which will secure the future of a smaller, sustainable business and will save over 350 jobs. I would like to thank all our colleagues at Hotter for their continued understanding at this difficult time"