Shoppers claimed that New Look gift cards weren’t accepted. Credit: COLLECT

As hundreds of shoppers flocked to the closing-down sales on Sunday, many returned home empty-handed. Videos on TikTok showed New Look shops in disarray as people scrambled to grab a bargain. However, the retailer’s decision not to honor vouchers left many shoppers feeling betrayed and frustrated.

Jane Manning, a New Look shopper, expressed her frustration, stating, “I’m actually fuming to be honest. My boyfriend got me a voucher for my birthday in January. It was only a few weeks ago as well. I was saving it. I said I’d wait for summer for their new stuff.”

A worker at the door of the shop informed her that no vouchers were being accepted. Jane continued, “He said you can sign a form, there’s a form here, a claim form to claim it back. And you have to put your vouchers in with the claim form.” Jane expressed her concern about whether she would ever get her money back, feeling that the store did not want to hear from customers with vouchers like her.

A former New Look worker shared her experience, saying, “We found out in the middle of the day through email. About half an hour later a member from KPMG entered our store and we had to ask everyone to leave and shut the shutters. The next two days were spent turning the stores into sale shops with no help.”

The worker also mentioned the chaos during the sales, stating, “Too many people were let in at once, even though they told 10-15 people at a time. The vouchers caused a lot of problems with staff getting the back hand of it.” She recounted instances of staff being abused by customers over the voucher scandal.

Over-Crowded Sales
The former worker explained the chaotic scene, saying, “When I went out to tell people we weren’t letting anyone in and shutting the shop an hour early I had a woman scream in my face over how long she was waiting and how she’s supporting us by queuing up to get in. Another woman was screaming in my face over the fact she couldn’t use her vouchers no matter how many times I explained it wasn’t our staff’s fault it was New Look. Another manager told me their staff was shouted and spat at over the fact we can’t accept vouchers.”

Investigation
The Irish consumer watchdog, the Competition and Consumer Protection Commission, is seeking clarification on the use of gift vouchers. A spokesperson for the CCPC stated, “The Consumer Protection (Gift Vouchers) Act 2019 covers the use of gift vouchers in Ireland. This legislation contains no exemption for sales of any kind, including closing-down sales. Officers from the CCPC contacted the liquidators in this case late last week regarding a number of consumer protection concerns. In our correspondence, we sought clarification on arrangements for the use of gift vouchers by consumers. Engagement with the liquidators is ongoing.”

A spokesperson for New Look said, “Per last week’s statement the Provisional Liquidators have taken over the management of the New Look ROI business including stock and voucher matters.” The High Court approved that Shane McCarthy and Cormac O’Connor of KPMG Ireland be appointed as Provisional Liquidators over the business and its assets.

Redundancies
With 26 stores across the Republic of Ireland, some 347 staff members have been let go. The affected stores include Northside Shopping Centre, Liffey Valley, Tallaght, Omni Park, Blanchardstown, and Jervis Street in Dublin, as well as locations in Cork, Carlow, Clonmel, Galway, Navan, Limerick, Dundalk, Newbridge, Killarney, Dungarvan, Wicklow, Wexford, Mullingar, Letterkenny, and Castlebar.

Struggling Shops
In a statement, the company shared the closure news to fans, saying, “Regrettably, a collective redundancy process impacting all colleagues in the Republic of Ireland is also envisaged. The decision to seek the appointment of liquidators was not taken lightly. New Look’s Irish operation has struggled for some years, impacted by a range of factors including supply-chain and in-market costs, and squeezed consumer spending. They added that the New Look Group decided it was no longer viable to trade in Ireland. They added, “The group will refocus investment on its UK business and its digital offering.”

New Look Fashion held closing down sales on Sunday. Credit: Alamy

Some 26 stores across the Republic of Ireland have shut. Credit: Getty

Implications for U.S. Retailers
The situation in Ireland serves as a cautionary tale for U.S. retailers facing similar challenges. The refusal to honor vouchers during a liquidation sale can lead to significant backlash from customers and potential legal repercussions. Retailers must carefully navigate the complexities of gift voucher redemption policies and ensure transparency and fairness to maintain customer trust and loyalty.

Consumer Protection and Legal Considerations
In the U.S., consumer protection laws vary by state, but many have strict regulations regarding gift cards and vouchers. For example, California’s Gift Card Act requires that gift cards must be redeemable for cash if the remaining balance is less than $10. Retailers must be aware of these regulations to avoid legal issues and maintain consumer confidence.

Case Study: The Case of RadioShack
In 2015, RadioShack faced a similar situation when it filed for bankruptcy and closed many of its stores. The company initially refused to honor gift cards, leading to widespread customer dissatisfaction and legal challenges. Ultimately, RadioShack had to honor the gift cards, highlighting the importance of adhering to consumer protection laws and maintaining customer trust during difficult times.

Conclusion
The closure of New Look stores in Ireland and the subsequent refusal to honor vouchers underscore the importance of transparency and fairness in retail operations. As U.S. retailers face similar challenges, they must prioritize consumer trust and adhere to legal regulations to avoid the pitfalls experienced by New Look. By learning from these examples, retailers can better navigate liquidation sales and maintain customer loyalty.