A Famous Luxury Store Says It Might Not Survive the Year
Harvey Nichols, the famous luxury department store founded in 1831, has warned it will run out of money within the next year unless a buyer steps in. Mike Ashley's Frasers Group is currently the leading bidder to buy the chain for around £40m (The Guardian).
The store's directors have formally said the business is not a "going concern" — a phrase used in accounting to mean a company may not be able to keep operating. They point to projected cash running out within 12 months and no new funding agreed (The Guardian). The Telegraph first reported this warning on 9 August (The Telegraph).
The trouble started during the coronavirus pandemic. Harvey Nichols relied heavily on big-spending foreign tourists, and when travel shut down, that income disappeared. The store has not made a profit since. For the year ending March 2025, it reported a loss of £105m, largely because of money lent between parts of the company that had to be written off as unrecoverable (The Guardian).
Sir Dickson Poon, a Hong Kong businessman, bought Harvey Nichols in 1991 for £53m. After years of losses, he appointed FTI Consulting in June to handle a sale. Poon retired as a director in May. Selling the company would end his 35 years of ownership. The store is currently run by chief executive Julia Goddard, who joined in 2024 from the fashion brand Alexander McQueen (Financial Times, Reuters).
Frasers Group is the frontrunner to buy the chain, according to Sky News (Reuters). Mike Ashley told the Financial Times that Harvey Nichols was in a "death spiral" and that fixing it would be a "huge challenge." His plan would keep only two stores under the Harvey Nichols name: the flagship store in London's Knightsbridge and the one in Edinburgh. All other UK stores would be renamed House of Fraser or Flannels — two brands Ashley already owns (The Guardian).
Another major retailer, Next, had considered buying Harvey Nichols but has since dropped out (The Guardian). The company says it has received several bids and hopes to complete a deal within the next year.
Harvey Nichols has stores across the UK in Birmingham, Bristol, Dublin, Edinburgh, and Manchester, plus restaurants including one at the Oxo Tower in London. Internationally, it operates in Riyadh, Dubai, Kuwait, and has two stores in Hong Kong. The main store has stood at Knightsbridge since 1889. The business began in 1831 as a linen shop.
The company's history shows up in its corporate filings. Harvey Nichols and Company Limited was registered in 1983 and remains active. A predecessor company dates back to 1902. Several smaller companies linked to the brand have been created and closed over the years. A new entity, Harvey Nichols International Ltd, was registered as recently as January 2026, suggesting the international side of the business may be getting reorganised.
The broader context here is that luxury retail has been hit hard by changes in how people shop and travel. Tourist spending has shifted, costs have risen, and more high-end shopping happens online now. The UK's decision to end duty-free shopping — a scheme that let foreign visitors claim back tax on purchases — has also hurt stores that depend on tourist traffic. Harvey Nichols sits squarely in that category, along with other department stores facing similar pressures since 2020.
What makes this situation different from a simple bankruptcy is the buyer's strategy. Ashley's plan to keep only two Harvey Nichols stores and rebrand the rest suggests he may be more interested in the properties and the brand name than in keeping the full chain alive. The £40m price, set against a £105m yearly loss, shows how much the cost of running the business weighs against what the brand is still worth. It is not clear from public information whether the international stores in Kuwait, Dubai, Riyadh, and Hong Kong would be part of the deal.
For now, the sale process continues under FTI Consulting, with Harvey Nichols' directors counting on a deal to be completed within the coming year.
