Morrisons planning to close 100 stores in next few months

Morrisons is planning to close 100 convenience stores across the UK over the coming months. The supermarket chain blamed government policy choices for rising operational costs.

The affected outlets are Morrisons Daily convenience stores that have been loss-making for several years. Morrisons acquired these locations through its acquisition of McColl's in 2022. While the company has not confirmed the exact number of job cuts, the planned closures are expected to put hundreds of staff members at risk of redundancy, with a consultation process set to begin shortly.

A spokesperson for Morrisons stated that the business would attempt to find alternative opportunities within the company for the affected employees. The chain currently operates approximately 1,700 Morrisons Daily stores and opened more than 120 franchise locations last year. Despite the closures, Morrisons indicated it has a "robust expansion plan" for 2026, which includes opening hundreds of franchise stores in the future.

In explaining the decision, the supermarket chain pointed to "significant cost increases resulting from government policy choices, which have made returning these stores to profitability even more difficult." These policies include recent increases to the national living wage and employer National Insurance contributions. Additionally, food and drink companies face new packaging recycling charges under the government's Extended Producer Responsibility (ERP) scheme.

A government spokesperson described the store closures as a commercial decision for Morrisons, adding, "we understand that this is a concerning time for workers and their families." The spokesperson noted that a broad range of support is available, and that "Acas can also provide employees and employers with free, impartial advice on workplace rights, rules, and best practice."

The retail sector has faced ongoing pressure from inflation, which remains above the Bank of England's 2% target. Annual food price inflation stood at 3% in April, outpacing the overall inflation rate of 2.8%. Warnings have also emerged that food inflation in the UK could reach 10% by the end of the year due to the geopolitical impact of the US-Israel war with Iran.

The closures follow previous cost-cutting measures by Morrisons, including the closure of 52 cafes and 17 convenience stores last year, as well as placing 200 jobs at risk at its Bradford headquarters last month. The announcement also arrives amid tensions between the government and the grocery industry, after sources revealed the government had urged supermarkets to voluntarily freeze key grocery prices in exchange for regulatory relief.

The price-freeze suggestion drew sharp criticism from retail leaders. Former Sainsbury's chief executive Justin King called the UK supermarket sector highly competitive, adding that it was "hypocritical" for the Treasury to request price caps while its own policies contributed to rising inflation.