269-branch retail chain fears for future after closing 39 shops

Footwear retailer Shoe Zone has launched a scathing attack on “highly adverse” government policies after reporting a dramatic collapse in annual profits and cautioning that earnings are poised to plummet further amid challenging market conditions. The high street stalwart witnessed its share price nosedive by 22% during Tuesday morning trading following the disclosure that pre-tax profits had crashed by more than two-thirds to £3.3 million in the year ending September 27, a sharp decline from £10.1 million the year before.

The company stated that trading pressures persisted into the opening months of 2025-26, hampered by fragile consumer confidence, whilst pointing the finger at Government budget decisions for driving costs skyward and dampening shopper expenditure. The business is projecting profits will slide to approximately £1 million in the year ending October – representing a 70% year-on-year decline.

Chairman Charles Smith said: “Trading conditions remained challenging in the first quarter of the new financial year, with revenue down on forecast, reflecting ongoing macro-economic pressures that continue to weigh on consumer confidence resulting in lower footfall on the UK high street, alongside the highly adverse Government fiscal policies.

“The Government’s November 2025 budget included an additional increase in the national living wage, raising our cost base further, with broader measures not materially improving consumer sentiment.”

The retailer has witnessed its share price plummet to a five-year low in recent months as trading difficulties have intensified. Store sales fell 10.3% to £113.1 million during 2024-25, with the company ending the year operating around 269 stores – a net reduction of 28 locations.

The chain closed 39 branches but opened 11, whilst also converting six sites to its larger store format. Mr Smith acknowledged that Government policy had an impact on the previous year’s performance, though he noted additional factors affected trading.

He said: “Persistent inflation, higher interest rates and reduced disposable income contributed to negative economic and consumer sentiment in the UK.

“Sales were good when there was a reason to buy, such as the warm summer and the back-to-school period, however discretionary spending remained subdued as consumers exercised greater caution in what they were spending money on.”

The business was initially established on July 21, 1917, as the Benson Shoe Company – a Leicester-based family footwear operation founded by the grandfather of today’s owners. For more than 60 years, it traded under the Bensonshoe name as a regional retailer.

The origins of today’s “Shoe Zone” date back to 1980, when brothers Michael and Christopher Smith acquired controlling stakes in their grandfather’s firm, Bensonshoe. The business formally adopted the trading name Discount Shoe Zone in 1996, before simplifying it to Shoe Zone in 2001.