Argos to Shut Down Irish Operations as Sainsbury’s Says Business is Not Viable.
Sainsbury’s, the owner of Argos, has announced that it will cease trading in all 34 Argos stores throughout the Republic of Ireland by June 25. The required investment to make the Irish division of Argos profitable was not feasible.
The move does not affect its operations in Northern Ireland or its outlets in the U.K.
The general merchandise retailer stated that it will offer an enhanced redundancy package to the affected workers, with 580 jobs still available, during negotiations with Mandate, which represents Irish retail workers.
Argos stated that it had decided to leave Ireland after “long periods of careful consideration” and a thorough assessment of its operations and business in Ireland. Argos agreed that the money required to modernize and develop the Irish company needed to be increased and would be better spent on other areas of the business.
Michael Meegan, a Mandate official, said that the company shared figures with the union in closing other stores during the past year and a half. He also stated that it had highlighted some of the challenges the wider business faced, such as the high cost of doing business here, the high rents, and supply chain issues, resulting from Brexit.
Meegan said it was a shock to the staff, who had worked with the company for an average of 11-15 years, when the 34-store chain would be closing.
According to the company, it will engage with the union representing around half the employees regarding the closures. It will also “propose an enhanced package of redundancy that goes far beyond its statutory obligations.”
Argos Ireland: Difficult News
Talks between the union and retailer are scheduled to start on January 30. Andy McClelland (Argos Ireland operations manager) understood this was difficult news for his customers and colleagues. We have made this difficult decision and will do everything in our power to help those affected.
According to the company, its Portlaoise retail outlet would close on May 6, with its St Stephen’s Green Dublin shopping center closing one week later. Galway will close on June 10 and Kilkenny on June 25. The company informed staff that all remaining stores would close on June 24 and that they would notify employees.
Customers from Ireland cannot order via Argos’ website after March 22. The company confirmed that orders placed before this date would be fulfilled. Customers can order products online and pay in-store until the business closes.
Sainsbury’s Switches Strategy
In 2023, Sainsbury’s purchased Argos for $1.36 million. In the U.K., its strategy was to close Argos stores and open outlets within Sainsbury’s supermarkets. The group doesn’t have a presence in Ireland, however.
In December, figures showed that the costs of closing three Argos stores last year led to pre-tax losses of fourfold at the Irish branch of the retailer to $ 14.1 million. Revenues declined by 21.25% to $183.7 million from $144.5 million during the 12 months ending March 2023.
In December, the figures included costs associated with closing several stores.
It was then announced that St Stephen’s Green would close and Kilkenny would be closed. However, the directors cautioned that they would continue to “review” the store portfolio in light of changing retail environments and the development and expansion of the company’s online offering.