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C&A UK Managing Director, Neil McCausland
"We don't believe we can find a viable future for C&A"
 real 28k

Retail analyst, Robert Clark
"It is the biggest thing to have happened in British retailing"
 real 28k

The BBC's Denise Mahoney
"It cannot compete in the tough UK clothing market"
 real 28k

Thursday, 15 June, 2000, 19:08 GMT 20:08 UK
Unions condemn C&A closures
Interior of C&A store
Union leaders have condemned the decision of Brussels-based high street clothing chain C&A to close all its UK stores, with the loss of 4,800 jobs.

For the shopworkers' union, Usdaw, general secretary Bill Connor said: "It is disgraceful and shocking to treat staff in such a cavalier way.

"It is unlikely that the company could get away with such a move in countries such as Germany and Holland, where labour relations are much stricter."

It is disgraceful and shocking to treat staff in such a cavalier way

Bill Conner, Usdaw

He said staff had been given no warning of the closures and that they were being sacked "just to maintain profits".

Des Farrell of the GMB union said there could be thousands of other job losses - in warehousing, transport and at firms which supply C&A.

C&A does not recognise trade unions but it said it would offer redundancy terms of twice the legal minimum and encourage retailers taking over its stores to employ existing staff.

Clive Vaughan, retail analyst with consultants Retail Intelligence, said: "It seems they are really feeling the impact of other discounters.

"There is a huge price deflation in clothing and that is affecting everybody."

Shock announcement

C&A shocked its staff on Thursday morning by announcing it would be closing all its 133 UK stores with the loss of 4,800 jobs.

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 wideranging job cuts 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).

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See also:

23 May 00 | Business
M&S confirms gloom
27 Mar 00 | Business
Bhs sold to M&S raider
02 Jun 00 | Business
UK retail prices fall
13 Apr 00 | Business
Arcadia ditches jobs and shops
26 May 00 | Business
Moss Bros to axe stores
15 Jun 00 | Business
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