Esprit, a prominent fashion brand in Germany, has declared insolvency as of August 1, 2024, leading to the closure of all 56 retail locations by the end of the year.

This decision results in the loss of approximately 1,300 jobs across the company.

Alteri, a British financial investor, will acquire the brand rights for Esprit's insolvent European operations, but will not take over the operational aspects of the business, meaning stores and employees will not be retained.

The creditors' committee for the seven insolvent Esprit companies in Germany has approved the winding down of operations.

Esprit Europe GmbH and its subsidiaries filed for insolvency in May, with the court process officially starting on August 1.

While the insolvency affects Esprit's European operations, its international businesses outside of Europe will remain unaffected.

Despite the closures, Esprit as a brand is expected to continue, with products still being manufactured and sold in Germany, although specific details on this arrangement are unclear.

The company faced recent accusations of mismanagement and supply chain issues from franchisees, contributing to its financial struggles.

The fashion industry is under significant pressure, with a recent wave of insolvencies affecting several brands, including Galeria Karstadt Kaufhof and Peek & Cloppenburg.

Industry experts note that exclusive or very affordable brands are performing better in the current market climate, highlighting a shift in consumer preferences.

Esprit was once a cult brand in Germany, particularly among older consumers, but has seen a decline in sales for years, reflecting broader challenges in the mid-price segment of the fashion market.