Retail giant exits U.S. fashion after multi-million-dollar scandal

It’s no secret that consumers in America have been tightening their belts due to the ongoing rise in inflation. A recent report from YouGov in March highlighted how a bleak financial outlook has influenced spending habits. As a result, many consumers are cutting back on non-essential purchases like clothing.

The U.S. Department of Commerce also reported a 0.7% decline in clothing store sales in December 2025, signaling a trend of decreased spending in this sector.

In Las Vegas, WH Smith, the owner of several clothing stores on the Strip, including Marshall Rousso and Misura, is closing 26 retail locations. The decline in tourism and reduced spending by visitors has contributed to the decision to shut down these stores.

However, the closures are part of a larger strategy by WH Smith to exit the North American fashion market entirely. The company plans to focus more on airport and travel convenience stalls moving forward.

WH Smith’s Strategic Shift

As per the company’s official announcement, WH Smith will be focusing on expanding its UK travel essentials and food-to-go offerings, strengthening its North America travel essentials sector, and completely exiting the North American fashion market.

The decision to pull out of the fashion market comes after a financial scandal where the North American division of WH Smith was found to have overstated its supplier income and promotional rebate revenues. This led to a significant revision of the company’s profit expectations.

Impact of Accounting Error on WH Smith

The accounting error not only affected WH Smith’s profitability but also led to a 42% drop in its stock value in a single day. The company is now working to rectify the financial records for previous years and recover overpaid bonuses from former executives.

In response to the scandal, WH Smith’s CEO stepped down, and the company appointed a new executive chair to steer its recovery efforts. The Financial Conduct Authority has also launched a formal investigation into the company’s North America division.

Store Closures and Future Plans

WH Smith has not disclosed which specific stores will be affected by the closures. The company is now focusing on its core markets and aims to drive growth through a franchise model while reviewing and exiting non-core markets.

WH Smith’s Fashion Brands

• Marshall Rousso: Women’s lifestyle fashion apparel, including handbags and jewelry.

• Misura: Contemporary men’s apparel and lifestyle boutique.

• Bella Scarpa: An elegant boutique catering to women seeking a feminine style.

• The Dean: Men’s fashion and lifestyle products from popular brands.

• @ ease: Athleisure apparel and accessories.

As WH Smith navigates the aftermath of the accounting scandal and strategic shifts, the company is facing challenges but is also taking steps to recover and refocus its business operations.