Morrisons announces major cafe closures and job losses despite returning to profitability, impacting several locations across the UK.
Morrisons, one of the UK’s leading supermarket chains, has just dropped a bombshell: they plan to close over 50 in-store cafes and several Morrisons Daily convenience stores across the country. This move will see more than 3,600 jobs vanish, creating a tough situation for both employees and loyal customers.
What does this mean for the future of shopping at Morrisons?
Details of the Closures
These closures will hit cafes in various locations, including Caernarfon, Brecon, and Connah’s Quay in Wales. Interestingly, this announcement comes right after Morrisons reported a return to profitability for the first time since being acquired by private equity in 2021.
They posted a pre-tax profit of £2.1 billion for the year ending October 27, 2024—quite a turnaround from the staggering losses of £919 million and £1.3 billion in the previous years.
So, what’s behind this seemingly contradictory decision? While the profit figures are impressive, they largely stem from selling their petrol forecourts to the Motor Fuel Group.
Plus, the supermarket saw a 3.9% increase in like-for-like sales and a 4.2% rise in total sales, totaling £3.9 billion in just the second quarter of this financial year. Yet, the retail landscape remains challenging.
Impact on Employment
In the wake of these closures, recent filings at Companies House tell a sobering story: the workforce has shrunk from 104,819 to 101,144. This reduction affects various roles, including store staff, manufacturing, distribution, and head office positions. Chief Executive Rami Baitieh has emphasized that despite these cuts, the company is committed to providing value to customers, especially in an economic climate characterized by inflation and cautious consumer spending.
Earlier this year, Morrisons already announced the closure of 17 Morrisons Daily stores, with the last one in Haxby, North Yorkshire, shutting its doors on May 14. The decision to close over 50 in-store cafes is part of a broader cost-cutting strategy that many in the supermarket sector are adopting. Competitors like Aldi, Tesco, and Sainsbury’s are facing similar pressures, with Sainsbury’s even deciding to close all its in-store cafes.
Conclusion and Future Outlook
The wave of closures at Morrisons marks a dramatic shift in the retail scene as businesses adapt to evolving market conditions. As the company navigates this challenging restructuring, the effects on employees and local communities will be closely watched. Morrisons’ leadership has reiterated its commitment to keeping customer value at the forefront while tackling the obstacles presented by the current economic landscape.
Stay tuned for more updates as we monitor the timeline for these closures and their overall impact on the workforce. What does this mean for your shopping experience? Only time will tell.
