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388 jobs at risk as stores to close
4:21pm Monday 21st January 2013 in Business Daily
NEARLY 400 jobs are at risk after Midlands Co-Operative announced it is to close its fashion and home department stores in the region due to competition from online shopping.
A total of 388 staff are employed at Midlands Co-Operative Home and Fashion stores in Stafford, Chesterfield, Coalville, Derby, Ilkeston, Long Eaton, West Bridgford, Wigston and Raunds.
The nine stores will close over the next six months but it is hoped most of the staff will be redeployed.
Martyn Cheatle, chief executive of Midlands Co-Operative, which is run independently from The Co-operative Group, said the fashion and home arm had incurred substantial losses over the last 10 years due to the growth of online shopping. He said none of the society's other areas of activity, which include food stores and crematoria, would be affected.
Mr Cheatle said customer orders and gift vouchers would be honoured over the next six months at the society's home and fashion stores.
He said: "Major changes in the retailing sector and the ever increasing growth in online shopping over recent years have created significant and fundamental challenges for the society's Fashion and Home business.
"Whilst our other businesses have flourished, the society has been incurring substantial losses from the Fashion and Home operation for more than a decade and in spite of sustained efforts to improve performance, the latest financial projections indicate a further decline with increasing losses in future years.
"A plan has been put in place for a phased closure of nine Fashion and Home stores over the next six months. This could potentially affect some 388 store-based employees, although every effort will be made to redeploy employees into other business areas and it is anticipated that the society's ambitious new food store development programme will help facilitate this. The society is also exploring viable change of use options for the Fashion and Home sites, including Raunds.
"Unfortunately, efforts to sell the business as a going concern have proved unsuccessful and after much consideration it is with great regret that the Board of Directors has taken this very difficult decision to close the Fashion and Home business. Please be assured this decision was not taken lightly and was necessary to protect the long-term future and growth of the society as a whole."
He added the society is in full consultation with all affected staff and trade unions.
© Press Association 2013
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