British baby and maternity retailer Mothercare has warned that its future is “highly uncertain” after its largest Middle East franchise partner indicated plans to close the substantial majority of its Mothercare stores in the region during 2027.
The franchise partner notified Mothercare on September 17 that it was reviewing its store portfolio amid the continuing situation across several of its markets. Although the review is ongoing, Mothercare said the partner currently expects the majority of its stores to close next year.
The closures are expected to result in a material reduction in Mothercare’s FY28 order book, with a corresponding impact on revenue, profitability and cash flow.
Mothercare said it has sufficient resources to continue trading for a number of months and has begun an immediate strategic review of its business model and cost base. However, the company cautioned that the outcome of the review and its longer-term solvency remain uncertain.
“At this stage the outcome of such a review and the longer-term solvency of the Company remains highly uncertain,” Mothercare said in its latest financial outlook update.
Chairman Clive Whiley said the development represented a significant setback for the business. “Whilst our recent financial performance has been resilient, this is a heavy blow to the Mothercare business and our stakeholders,” Whiley said. He added that the company would continue discussions aimed at restoring the “critical mass and value for stakeholders” against the current backdrop.
The warning highlights the importance of the Middle East to Mothercare’s international franchise model. The company has shifted to an asset-light strategy built around franchise partnerships, with local operators holding rights to develop and operate the Mothercare brand in individual territories.
Mothercare’s franchise network operated 331 stores at the end of FY2026, compared with 372 a year earlier. Global retail sales generated by franchise partners fell to £180 million in FY2026, from £230.6 million the previous year, reflecting pressure across several markets, including the Middle East.
The company has been seeking to offset challenges in the region through expansion elsewhere. Its South Asian business, operated through a joint venture with Reliance Brands, covers India, Nepal, Sri Lanka, Bhutan and Bangladesh, while Mothercare has also expanded its international licensing and franchise network through partners such as Turkey’s Ebebek.
The latest development nevertheless puts further pressure on a business whose strategy depends heavily on maintaining sufficient scale across its international franchise network.
Mothercare said its immediate focus is on supporting its franchise partners, reviewing its cost base and exploring options to restore the scale required to strengthen the business.
