C&A quits UK

The high street clothes chain C&A is to close all its UK stores, with the loss of 4,800 jobs.

The news was broken to staff at the 113 stores across the UK at meetings held on Thursday morning.

On a bleak day for jobs in the UK, aerospace firm BAE Systems also said that it was shedding 3,800 staff.

The majority of the C&A stores will close at the end of the year. Three distribution centres will also go, plus the store in Dublin

C&A, privately owned by the Dutch Brenninkmeyer family, is notoriously secretive, not even notifying senior managers of its financial results until 1998.

But the new openness did not stretch as far as publishing the results to the outside world, which added to the unexpected nature of the decision to quit the UK.

"This is a sad and difficult decision for the company," said managing director, Neil McCausland, adding that it had racked up £250m of losses in the UK in the past five years.

"C&A has been part of the British high street for over 75 years and was determined to remain so.

"Unfortunately, business conditions do not allow this to happen."

Mid-market squeezed

A growing number of UK high street retailers have suffered sharp falls in profits in the past two years.

Those which have already implemented widescale job cuts and/or store closure programmes include Marks & Spencer, Burtons owner Arcadia, Storehouse and Littlewoods.

What unites all those is that they are in the mid-market, and have been squeezed on all fronts by growing competition.

Mr McCausland said that the past five years had seen a dramatic change in the UK's retail industry which C&A had failed to overcome.

The two main elements had been the growth of discount stores such as Matalan and Peacocks, and also the growth of brand shops such as Gap and Next, which targeted specific parts of the market.

Knock-on effects

He said that the company had tried a range of initiatives to protect itself from the growing competition, but had decided, after racking up the huge losses, that a complete closure of its UK operations was the only answer.

He said that the chain, which has 577 stores in 12 European countries, had not suffered the same scale of problems in other markets.

It has also moved to a centralised European buying system, meaning that it would have a "product offer that did not meet UK customers' needs".

C&A is thought to own most of its stores outright and selling off the sites will raise millions for the Brussels-based company, which will continue to operate in Europe.

Total turnover at the C&A group last year was 5 billion euro (£3.3bn).

C&A does not recognise trade unions, but union officials expressed shock at the news.

John Edmonds, general secretary of the GMB general union, said: "This is a major blow for the employees and for the high street as a whole."

C&A said it would offer redundancy terms twice the legal minimum and encourage retailers taking over its stores to employ its existing staff.