The UK’s fifth-biggest supermarket chain, which beat Asda’s owners to buy the retailer’s 1,164 stores and newsagents out of administration earlier this year, said despite the cuts it believed the business had “strong potential”. . McColls, which was started by Scottish footballer Robert Smyth McColl in 1901 with a single store in Glasgow, now has stores across Great Britain. “We deeply regret the proposed closure of 132 loss-making stores, but it is, very sadly, an important step towards the regeneration of the business,” said Joseph Sutton, Morrisons online and wholesale director. “We have a lot of work to do, but there is no doubt that McColl’s is a business with strong potential.” The closures come after Morrisons, which lost its place as the UK’s fourth-biggest grocer in September when it was overtaken by Aldi, revealed profits had plunged 50% this summer as it faced “unprecedented inflationary pressures” in the domestic of food processing. arm. Supermarkets are facing higher prices from grocery suppliers and increased labor and energy costs as shoppers cut spending on non-essentials as they face rising inflation in their electricity and gas, mortgage, rent and food bills. Convenience stores also face competition from delivery services such as Deliveroo, JustEat and Getir, which have expanded rapidly during the pandemic. The UK’s biggest grocer, Tesco, is also expanding, adding three new cashier-free stores this week in London and Birmingham. Morrisons is believed to be under additional pressure from rising borrowing costs after debts jumped from £3.2bn in January 2021 to £6.8bn a year later to fund last year’s takeover deal by the US private equity firm. shares of Clayton, Dubilier & Rice. The company said it would delay the closure of 55 McColl’s stores that house Post Office counters until next year to “allow them to serve their communities until Christmas and allow the Post Office extra time to make alternative arrangements”. Morrisons also said that all staff affected would be offered alternative employment at a nearby McColl’s or Morrisons store or at one of its logistics operations or food production centres. “We are now in a position to begin the urgent journey to transform McColl’s into a viable, well-invested and growing business,” said David Potts, chief executive of Morrisons. Subscribe to Business Today Get ready for the business day – we’ll point you to all the business news and analysis you need every morning Privacy Notice: Newsletters may contain information about charities, online advertising and content sponsored by external parties. For more information, see our Privacy Policy. We use Google reCaptcha to protect our website and Google’s Privacy Policy and Terms of Service apply. Last month, the UK competition regulator cleared the way for Morrisons’ £190m rescue deal to be cleared on the condition that it sell 28 McColl’s stores in 35 areas where the two retailers compete. All of McColl’s 16,000 staff were transferred to Morrisons as part of the deal. Morrisons’ new parent CD&R is also the parent company of Motor Fuel Group, which has more than 800 convenience stores, the vast majority of which are part of its petrol stations. The supermarket chain says it has plans to convert 1,000 McColl’s stores to the Morrisons Daily format within two years, a rebranding process it says is boosting sales by a fifth, based on the 286 stores it has already rebranded.
