The Original Factory Shop, the UK homeware and discount retail chain, has called in administrators, putting 1,200 jobs at risk. The company said rising costs from government policies, combined with weak consumer demand, made profitable trading increasingly unlikely. Administrators from Interpath have been appointed to oversee the 137-store chain, which was acquired by private equity firm Modella Capital less than a year ago. The company will continue to trade on high streets while the administrators “assess options for the business.” Orders placed online before 28 January will be delivered as normal, but new orders have been temporarily suspended. Modella said the decision, though difficult, reflected the challenges facing the business. “The Original Factory Shop doesn’t have a realistic possibility of trading profitably again,” the firm said. “The legacy effects of trading prior to our ownership left them highly vulnerable. A combination of very weak consumer confidence, adverse government fiscal policies, and continued cost inflation is causing many established and much-loved businesses to suffer badly.” Administrators noted that high-cost inflation, fragile consumer confidence, and rising employment expenses had all contributed to the company’s difficulties. Supply chain issues with its third-party warehouse and distribution partner further worsened the trading environment. Rick Harrison, joint administrator at Interpath, said: “The Original Factory Shop has long been a cornerstone of local high streets up and down the country. Unfortunately, however, trading challenges have impacted the business.” The administration follows a period of restructuring. Six months ago, the company moved its head office and distribution center from Burnley to Bolton and negotiated rent reductions for several stores. Despite these measures, the retailer recorded a £5.6m pre-tax loss for the year ending 31 March 2024, with sales falling slightly to £117.5m, even amid high inflation. Modella Capital also owns other retail brands, including Claire’s, Hobbycraft, and the UK arm of WH Smith, renamed TG Jones. The group has previously backed ill-fated UK licensees for Ted Baker. Earlier this month, Claire’s was also put into administration, putting 1,350 jobs at risk. Fashion chain LK Bennett was recently bought out of administration by restructuring specialist Gordon Brothers, although the deal excluded stores. The Original Factory Shop was founded by the Black family in Keighley, West Yorkshire, in 1969. It expanded steadily over decades, including the acquisition of 35 Woolworths stores after the 2009 collapse of that chain, which helped fill gaps on Britain’s high streets. In February 2025, Modella Capital acquired the retailer from Duke Street Capital. Retail analysts say the company’s difficulties reflect wider challenges on UK high streets. Modella highlighted a significant decline in pre-Christmas footfall, with shoppers increasingly prioritizing essential spending on food and energy over discretionary items such as home furnishings. Meanwhile, other UK chains are also facing financial pressures. Game Retail, part of Mike Ashley’s Frasers Group, announced its intention to appoint administrators to protect against creditors. The company employs over 1,900 people across more than 200 standalone stores, as well as outlets in Sports Direct and House of Fraser. Accounts filed at Companies House show the business fell £2.5m into the red in the year to April 2024, with sales dropping from £287.2m to £222.6m. The administration of The Original Factory Shop highlights the ongoing fragility of UK high street retailers. Rising operational costs, weak consumer confidence, and ongoing economic uncertainty have combined to create a difficult trading climate for established brands. The company’s future now rests on the administrators’ assessment, as staff, customers, and communities await clarity on whether the retailer can be rescued or sold.