Woolies loss would be High Street low

Nov 28 2008 by Alison Anderson, Perthshire Advertiser Friday

WOOLWORTHS’ staff face an uncertain future and the townscapes of Perth and Blairgowrie could dramatically change as the most familiar name on the High Street fights for its future.

It was announced yesterday that the retail division of Woolworths had gone into administration as a result of its £385m debt.

The move will allow the company to continue as a going concern, under supervision, while efforts are made to rescue the chain.

All 815 Woolworths’ stores in the UK remain open for now, but there are fears for the company’s 30,000 jobs and, in Perth, for the future of one of the most prominent sites on the High Street.

On the same day the Woolworths’ announcement was made, the axe fell on another major trader with a presence in Perth – furniture retailer MFI.

Part of MFI went into administration in September, and yesterday it emerged that the rescue package on the chain’s remaining 111 stores rescued in a management buyout would follow suit.

The company announced yesterday that all MFI stores could remain open for the sale of display stock only.

Perthshire Chamber of Commerce president Mike Beale expressed sadness at the human cost of the company collapses: “I normally try and find positive aspects to any situation, but there are no silver linings to these closure threats.

“It saddens me to think of the impact on employees who are likely to lose their jobs,” said the business leader yesterday.

“The two other negative aspects are the big holes they will leave if the buildings these retailers occupy become vacant and the underlying impact on spending power in Perth as more jobs are lost in the retail sector..

“An empty shop in the centre of Perth High Street would not be good, and at St Catherine’s Retail Park there is already a big hole with the former B&Q premises not being filled.”

Referring to the possible closure of the Perth branch of Woolworths, Mr Beale expressed the hope that another retailer looking to locate in the city may be attracted by the size and central location of the building.

“It has been said that none of the empty units in Perth is the right size. They are all too small. The Woolworths unit is the one big one which might be attractive to companies.”

The SNP’s Perth parliamentarians Pete Wishart MP for Perth and North Perthshire, and Roseanna Cunningham MSP for Perth, also expressed their concerns over the future for iconic High Street brand Woolworths and its employees in Perth and Blairgowrie.

Ms Cunningham said: “Woolworths has been a fixture of High Streets the length and breadth of the country for almost 100 years, surviving several recessions.

“It has been no secret that the company has faced difficulties in recent years but the fact it is now going into administration is very worrying and the staff at the Woolies in Perth must be very concerned indeed.

“I sincerely hope that the administrators are able to find a future for the stores.”

Mr Wishart added: “In the run up to Christmas this news will be very worrying for Woolworths staff in Perth and Blairgowrie and I sincerely hope that a rescue package that will safeguard jobs can be found.

“This is yet more evidence of the problems that are facing businesses large and small with the looming recession. The Scottish Government have taken strong action to help small businesses with the small business bonus which slashed business rates.

“The UK government must now step up action and ensure that the re-capitalised banks take a compassionate attitude to businesses and to individuals in these tough times.”

Councillor John Kellas, Perth and Kinross Enterprise and Infrastructure convener, commented: “The situation with Woolworths is currently unclear. We hope for a positive outcome for employees and Perth. We are keen to see the vibrancy of the local retail sector maintained.”

The first UK Woolworths store opened in Liverpool in 1909, but financial experts report that Woolworths has been one of the UK’s weakest retailers for a number of years.