// Dixons Carphone to close all standalone Carphone Warehouse stores
// 2900 jobs are at risk
// Dixons Carphone to now sell mobile phones through its “shop in shops” in 305 Currys PC World stores & online
Dixons Carphone will shut down all 531 Carphone Warehouse stores as part of the ongoing overhaul of its mobile arm, resulting in 2900 job losses.
The closures will be effective as of April 3, as Dixons Carphone shifts its focus on selling mobile phones through its “shop in shops” in 305 big Currys PC World stores and online.
These stores, which are 20 times larger than Carphone Warehouse standalone stores, allow customers to “see, touch and play with technology” and receive advice from 17,000 store colleagues in one place.
- Can Dixons Carphone survive when mobile phone sales are declining?
- Dixons Carphone hires former John Lewis exec as CCO
The group’s 70 Carphone Warehouse stores in Ireland will remain open and its international operations are unaffected.
Almost 1800 of its affected staff are set to take new roles elsewhere in the business.
The parent company of Carphone Warehouse and Currys PC maintained that the planned closures – which account for eight per cent of its UK selling space – are not linked to the coronavirus outbreak.
However, the company will be preparing for a potential “significant reduction” in sales in the months ahead by switching to its online channels.
Dixons Carphone admitted that its struggling mobile phone business will make a £90 million loss this year, and the store closures are a way to bring it back to profitability.
It has been affected by a growing trend among consumers to delay upgrading their mobile phones.
Meanwhile, the group said that sales of fridges, freezers, small domestic appliances and laptops had seen “notable increases in sales” following the coronavirus outbreak.
Dixons Carphone said it had not yet seen a large hit from the coronavirus crisis across its core chain apart from supply issues, but is “preparing for one”.
However, its 29 travel stores have been affected by the outbreak as passenger numbers dropped, and it is expecting profits from the division to be knocked by around £5 million.
“There’s never an easy time for an announcement like this, but the turbulent times ahead only underline the importance of acting now,” Carphone Warehouse group chief executive Alex Baldock said.
“We’re working hard to look after those colleagues we can’t find new roles for, financially and otherwise.
“We’ll pay enhanced redundancy, any bonuses, honour their share awards, and help them find new jobs through an outplacement programme.
“I don’t underestimate how upsetting this news will be for our colleagues, and we’ll treat everyone with honesty, respect and care. We want to keep as many of our Carphone Warehouse colleagues as we can.”
Dixons Carphone said: “We are aware that our stores could experience a significant reduction in sales in the months ahead and we are modelling a range of downside scenarios and planning accordingly.
“We are ready to switch more fulfilment to our online and direct channels and we will manage our costs and cash closely, including a tight control of capital expenditure if necessary.”