Dobbies to close 17 sites

465 jobs affected as garden centre retailer confirms restructuring plan

 

As garden centres swing into the Christmas season with festive shops already offering a wide range of cards, gifts, and Santa’s grottoes, Dobbies has announced the closure of 17 unprofitable outlets in a restructuring plan.

Of the current 77-strong estate – where the 71 main outlets have significant card, calendar and stationery sales –  all the Little Dobbies sites at Cheltenham, Chiswick, Clifton, Richmond, Stockbridge, and Westbourne Grove are for the chop, alongside full-size stores in Altrincham, Antrim, Gloucester, Gosforth, Harlestone Heath, Huntingdon, Inverness, King’s Lynn, Pennine, Reading, and Stratford-upon-Avon.

Above: Dobbies has a sizeable greeting card offer
Above: Dobbies has a sizeable greeting card offer

The 160-year-old garden centre chain is thought to have faced another difficult period after racking up losses of £130.2million in the year to 5 March, 2023, a huge drop from the £21.3m loss the year prior, blaming high inflation and unseasonable weather as dampening sales. It has now stated its aim is to “address historically uneconomical rent costs and ensure a return to sustainable profitability” which, alongside other “tangible cost savings” will secure its long-term future and allow “access to future investment”.

The Dobbies move and significant store closures announced by Boots, which sells a large Christmas card range, have led Andrew Goodacre, CEO of British Independent Retailers’ Assocation (BIRA), to call on the government for retail support.

“A recent report from PwC showed that there are 12 businesses closing on the UK’s High Streets daily,” Andrew said. “All these announcements show the stark reality of how difficult it is for retailers at the moment. There is also a strong message for the Chancellor as she prepares for the Autumn Statement on 30 October 30 – High Streets and independent retailers need support now.”

The garden centre group’s announcement comes a fortnight after Sky News reported that City sources said FTW Consulting had been drafted in to work on the restructuring plan, when Dobbies had not commented on speculation that it was planning a major financial overhaul which could lead to store closures and rent reductions.

The business was sold by Tesco to a group of investors in 2016 and is now controlled by major US investor Ares Management after a restructuring of its debt 18 months ago.

The plan will affect 465 of the retailer’s 3,600 employees, and see it aiming to work with landlords to seek temporary rent reductions at a further nine sites.

Above: All the town and city centre Little Dobbies outlets will close
Above: All the town and city centre Little Dobbies outlets will close

All shops are continuing to operate as normal during the process, with expectations that the 17 sites will cease trading by the end of the year, subject to the restructuring plan being approved by creditors – if that doesn’t happen it’s understood then an insolvency process of some kind is likely.

Others in the wider gardening sector have also been feeling the brunt of current economic challenges. DIY and garden chain Homebase has been looking to downsize its 140-plus store estate, and has just sold 10 outlets to former owner Sainsbury’s, while current private equity owner Hilco has put the whole business up for sale following the £85.2m loss to 1 January, 2023, after the £55.6m pre-tax profit the year before.

Amy Stubbs, development and project manager at British Garden Centres, which was a finalist in The Retas awards this year in the Best Garden Centre Retailer Of Greeting Cards Multiple category, told Retail Gazette yesterday that the weather has played havoc with trading this year, keeping customers away.

She added: “It’s never really felt like the season has properly started. We always normally feel like we have a bit of a rush and we can tell that the season’s kicked in but, this year, it hasn’t ever felt like it’s got going. It almost feels like any time it’s had a chance to start, the weather has then ruined it and it’s gone backwards again. It’s just been very stop-start.”

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