The M&Co shop in Lerwick will be saved as part of a restructure that will see dozens of stores close across the country.
Administrators were appointed at the fashion chain in the spring as the coronavirus pandemic forced closures. On Wednesday the retailer announced plans to close 47 stores, with 380 jobs at risk.
The Lerwick branch is safe, according to chief executive Andy McGeoch. The company is pulling out of many locations but wants to retain 200 “local High Street stores”.
Mr McGeoch said: “Local economies rely to a huge degree on their town centres and we have seen too many High Streets hollowed out by successive shop closures.
“More and more people are beginning to realise that, if they don’t support their town centres, everyone’s quality of living really takes a hit, so we are proud to be playing a part in the drive to shop locally.”