Warehouse closures puts hundreds of jobs at risk
The new boss of department store chain Debenhams has unveiled plans to close 11 warehouses and put up to 10 stores under review, in a move impacting at least 220 jobs.
Sergio Bucher, who took over as chief executive last October, outlined an overhaul that will see the group shut one of its three distribution centres run by DHL, 10 smaller in-house warehouses and potentially axe up to 10 of its 176 stores over the next five years.
The branches under threat of closure have not yet been identified. There are 10 Debenhams stores in Wales – in Cardiff, Newport, Merthyr Tydfil, Swansea, Llanelli, Carmarthen, Haverfordwest, Wrexham, Llandudno, and Bangor.
The DHL warehouse employs 220 staff and will shut in two years’ time, but Debenhams hopes to be able to redeploy many staff affected by the smaller warehouse closures. It is hoped that DHL will also seek to redeploy many employees affected by the closure of the Lodge Farm distribution centre in Northamptonshire.
Details of Mr Bucher’s plans came as the group announced a 6.4% drop in pre-tax profits to £87.8m for the six months to March 4.
Mr Bucher’s turnaround will also see the group cull in-house brands and leave some international markets, while also shifting around 2,000 staff to customer-facing roles as part of a drive to lure shoppers back to its stores.
This will see the group offer customers experiences as it battles against a wider trend to switch spending away from clothes towards eating out and holidays.
Mr Bucher said: “Our customers are changing the way they shop and we are changing too.
“Shopping with Debenhams should be effortless, reliable and fun, whichever channel our customers use. We will be a destination for ‘social shopping’ with mobile the unifying platform for interacting with our customers.”
Debenhams is also looking at trialling departments that will tie up click and collect with personal shopping services in the autumn, while also considering converting some smaller stores to outlets.
The group said it will report back with more details on the plans and international markets being eyed for exit in October.
Debenhams sought to give assurances that the overhaul was “not about job losses”, adding that as well as mulling store closures, it is also aiming to open four shops in the next few years.