Dobbies has announced that it will be closing the doors to 17 stores by the end of this year – including one based in Inverness.
The UK’s largest garden centre has revealed that the Scottish city’s branch will be closing as part of its new “restructuring” plan for “unprofitable” stores. If approved, the plan will see 11 mainline sites closed, alongside six smaller “Little Dobbies” stores.
The plan aims to “address historically uneconomical rent costs and ensure a return to sustainable profitability”. It’s important to note the firm has not gone into administration, but the restructuring plan will need to be approved by landlords and ratified by a court.
As reported by the Mirror, these types of schemes have often been used by companies looking to close down underperforming stores and win rent concession from landlords.
If the restructuring plans are approved, it will impact 465 of the garden centre’s 3,600 employees, and will leave the firm with 60 garden centres across the UK. It will also collaborate with landlords to seek temporary reductions at a further nine sites.
Dobbies has put together the plan with FTI Consulting and its shareholders, Ares. The closure process is not said to affect store operations and suppliers, which will continue as normal.
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The Renfrewshire-founded company has reported major losses over the past two years, which led it to plan a financial overhaul back in August. The latest annual results reported a £130million loss, while the year before was reported to be a loss of £21.3 million.
Dobbies did warn that the financial overhaul could lead to rent cuts and shop closures, with its recent losses being attributed to unseasonable weather and high inflation. It also comes 18 months after its shareholders, Ares, took control of the firm from Midlothian Capital Partners.
In its announcement, Dobbies said: “The restructuring programme and other strategic initiatives, are expected to return Dobbies to sustainable profitability through site rationalisations, rent reductions and other tangible cost savings – securing its long-term future and allowing access to future investment.”
List of Dobbies stores set to close
- Inverness
- Altrincham
- Antrim
- Gloucester
- Gosforth
- Harlestone Heath
- Huntingdon
- King’s Lynn
- Pennine
- Reading
- Stratford-upon-Avon
Little Dobbies
- Cheltenham
- Chiswick
- Clifton
- Richmond
- Stockbridge
- Westbourne Grove
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