HOME Retail Group said yesterday it planned to shut a quarter of Homebase’s 323 branches, blaming excess retail space and the rise of a generation that had fallen out of love with DIY.
Chief executive John Walden said the rise of online and growing competition had left the DIY market “over-spaced” while an increasing number of younger “time-starved” people threatened to derail the sector. “As a nation, we are becoming less adept at DIY,” he said.
Around 80 stores will shut by 2018, part of a three-year turnaround plan that will see it introduce more Argos and Habitat concessions, sharpen prices and retrain staff.
The move could result in 2,000 job losses, but Walden insisted it would “work hard” to find new jobs for its staff and intended create more jobs across the business overall.
Home Retail posted a 13 per cent rise in underlying profit to £30.9m in the six months to 30 August, with sales up three per cent to £2.7bn. Sales at Argos stores open over a year increased by 2.9 per cent and by 4.1 per cent at Homebase.
The company has been transforming its 747-store Argos business from a catalogue chain to a digitally-led business, targeting more sales from mobile phones and revamping its stores with iPads for browsing and faster check-outs.
Around 50 stores will be converted to its new digital format ahead of Christmas, the group said.
Home Retail is investing £300m in Argos as part of a five-year plan that is targeting a 15 per cent rise in revenue to £4.5bn by 2018.