Another blow for the struggling high street as Carphone Warehouse’s owner, Dixons Carphone, confirmed it is to close 531 stores in the UK, with the loss of 2,900 jobs.
The firm said this “essential next step” is designed to help in the “turnaround of its UK mobile business.”
It comes on top of the closure of 92 standalone stores in 2018. Carphone Warehouse did at one stage have approximately 700 stores across the UK, but it has struggled to contend with changes in mobile phone purchasing, as well as rising costs, due in part to a rise in the minimum wage.
Now the firm has confirmed that all of its remaining standalone shops will be closed.
“Dixons Carphone is taking the next step in its transformation by joining up its UK Mobile operations with the wider business as customers change how they buy mobile devices, connectivity and technology overall,” the firm said.
“The company will close its 531 standalone Carphone Warehouse stores in the UK and focus on selling mobile devices and connectivity through its shop-in-shops in 305 big Currys PCWorld stores and online,” it said.
These store closures will result in 2,900 redundancies, but it said that almost 40 percent of staff (1,800) affected by the closures are expected to take new roles in the business.
The small standalone stores, representing 8 percent of Dixons Carphone’s total UK selling space, will close on 3 April 2020, the firm said.
“Dixons Carphone will go well beyond legal obligations in financial and other support for all affected colleagues,” it said. “There’s never an easy time for an announcement like this, but the turbulent times ahead only underline the importance of acting now, to ensure a business fit for the future.”
Dixons Carphone said that its mobile operations made a loss of £90 million last year, and the reason for the closures is that “customers are changing the way they buy mobile devices and connectivity, replacing their handsets less often and buying them separately or as part of more flexible bundles.”
“Customers are also increasingly choosing to shop, not only with our large and growing online business, but also in the company’s big 3-in-1 stores, featuring Currys, PCWorld and Carphone Warehouse, which continue to grow market share and where customer satisfaction is sharply up,” it added.
The closures do not affect the 70 Carphone Warehouse stores in the Republic of Ireland or any operations internationally.
“Customers are changing how they buy technology, and Dixons Carphone must change with them,” said Alex Baldock, Group chief executive. “Today’s tough decision is an essential part of that, the next step in making our UK Mobile business a success for customers, colleagues and other shareholders.”
“Clearly, with unsustainable losses of £90m expected this year, Mobile is currently holding back the whole business,” said Baldock. “There’s never an easy time for an announcement like this, but the turbulent times ahead only underline the importance of acting now.”
“But though this is by far the toughest decision we’ve had to make, it is necessary,” said Baldock. “We must follow our customers. They want help with all technology, all in one place, and this trend is only going to accelerate in a more connected 5G world.”
Speaking to the BBC’s Today programme, Baldock emphasised the decision was nothing to do with the Coronavirus outbreak.
How much do you know about UK mobile operators? Try our quiz!
Real world consequence of ransomware attacks. A female patient has died as a result of…
Plan to keep majority stake in TikTok, will hinder White House approval reports suggest, as…
Blunt warning from Facebook about blocking news sharing down under, receives equally blunt response from…