Morrisons to close 132 McColl's stores putting 1,300 jobs at risk

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Morrisons is to close more than 130 McColl’s stores, leaving 1,300 jobs hanging in the balance.

McColl's Shropshire

One thousand McColl’s shops will be converted into the Morrisons Daily format

The supermarket giant, which bought McColl’s out of administration earlier this year, said 132 of McColl’s 1,164 shops were loss-making and had “no realistic prospect of achieving a breakeven position in the medium term”.

Morrisons will close the majority of those 132 stores before the end of this year, though 55 of the shops, which contain Post Office branches, will remain open until early 2023.

The grocer said this would allow these Post Offices “to serve their communities through Christmas and to allow the Post Office additional time to make alternative arrangements”.

The move leaves 1,300 McColl’s roles at risk of redundancy, though Morrisons said affected colleagues will be offered “alternative employment at a nearby McColl’s store, Morrisons store, logistics operation or food-making centre”.

Alongside the store closures, Morrisons unveiled its strategy to grow the McColl’s business.

It plans to convert 1,000 shops into the Morrisons Daily format within the next two years.

Its previous aim under the supply and franchise partnerships between the two businesses was to open 450 Morrisons Daily shops.

Currently, 286 McColl’s shops trade under the Morrisons Daily format. Converted stores deliver an average like-for-like sales increase of more than 20%, Morrisons said.

It insisted the accelerated Morrisons Daily rollout formed part of its plans to “invest significantly” in the McColl’s business.

Morrisons said its initial focus would be placed on “the store environment, fresh food, competitiveness, training, maintenance and systems”, including investment in price.

Morrisons convenience, online and wholesale director Joseph Sutton has taken on responsibility for the McColl’s business. McColl’s interim chief executive Karen Bird and finance boss Giles David have both stepped down.

Morrisons chief executive David Potts said: “Today marks an important moment for the McColl’s business, colleagues and customers as we formally welcome the business and its colleagues into the Morrisons family. We are now able to begin the urgent journey to transform McColl’s into a viable, well-invested and growing operation.

“Over the last three years, we have seen the significant enhancements that the conversion of a McColl’s store to a Morrisons Daily can achieve, so I am very pleased that we will now have over 1,000 Morrisons Daily stores trading within two years.

“I’m confident that the McColl’s conversions, combined with the increased competitiveness that will be unlocked through investment and synergies, will make Morrisons a growing force in the important convenience market in the years to come.”

Sutton admitted the business had “a great deal of work to do” but insisted McColl’s had “strong potential” to grow.

He added: “We very much regret the proposed closure of 132 loss-making stores but it is, very sadly, an important step towards the regeneration of the business. I am confident that McColl’s can, in the Morrisons family, once again become a growing, thriving and vibrant convenience business serving local communities across the UK.

“We are pleased to be able to offer every colleague alternative employment within the Morrisons group but we fully recognise that this might not be a practical solution for all colleagues.”