Dobbies plans to close 17 of its 77 shops, which will affect 465 jobs. The new owners are trying to bring the garden centre group back to profitability. The company that employs 3,600 people said they were seeking approval from creditors for a reorganization plan to reduce their rent bill. Eleven large, unprofitable garden centres will be closed by the end the year. The company also plans to close all six “little Dobbies”, high-street sites. It has said that it is seeking rent reductions on nine more sites.
Changes are being made amid a tough year for garden centres, with a wet and cold spring impacting trade during the busiest season of the year. Due to the high costs of essentials such as heating bills, rents, and mortgages households have also been forced to cut back on spending for expensive items like new patios, garden furniture, or fences.
The Covid pandemic saw a boom in garden centres as entertaining alfresco allowed families to stay in touch, while keeping a social distance. The surge in spending for homes and gardens is now stalling, placing pressure on other chains, including DIY group Homebase. Homebase is looking for a new owner, after selling 10 sites to Sainsbury’s, after it fell £85m in the red last year.
Dobbies, which was purchased by Ares Management last year, suffered a £105.2m (£7m) loss before tax in the year ending March 2023 compared to a £7m (£7m) loss the previous year, according to the company’s most recent accounts.
The company stated: “The restructuring plans, along with other strategic initiatives are expected to return Dobbies back to sustainable profitability, through site rationalisations. Rent reductions, and other tangible cost-savings. This will secure its long-term success and allow access to future investments.
“Thereafter, Dobbies is going to operate 60 stores, continue playing a major role in the marketplace, work constructively with suppliers and stakeholders, and play an active role in communities where it is based.”
Andrew Goodacre is the chief executive officer of the British Independent Retailers Association. He said that the closures show “the stark truth of how difficult things are for retailers right now”. Goodacre added: “There’s also a message for the chancellor, as she prepares to make the autumn statement, on 30th October. High streets and independent retail need support immediately.”
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