Morrisons is set to close 100 of its convenience stores in a restructuring move that will put hundreds of jobs at risk, as the supermarket chain warns that rising labour and tax costs have made many locations financially unviable.
The Bradford-based retailer confirmed that all affected outlets were legacy McColl’s stores, acquired when the collapsed convenience chain was rescued in 2022. The company said the stores have struggled for years despite attempts to improve performance, and closures will take place gradually over the coming months, with staff entering consultation.
In a strongly worded statement, Morrisons linked the decision to wider economic pressures, pointing to what it described as “significant cost increases resulting from Government policy choices” that have made turning the stores around increasingly difficult.
While the company did not name specific measures, the comments come shortly after a rise in the National Living Wage. From April, pay for workers aged 21 and over increased to £12.71 an hour, while younger workers and apprentices also saw increases. At the same time, higher employer National Insurance contributions and a lower threshold for payments have added further pressure on retail payrolls.
Industry groups have warned that these changes are adding billions of pounds in extra costs across the sector. The British Retail Consortium estimates that rising employment expenses could contribute to significant job losses over the next few years as firms adjust operations.
Morrisons’ difficulties with the McColl’s estate have been ongoing since it acquired the business for around £190m in 2022. The group initially closed more than 130 underperforming sites and converted the remainder into Morrisons Daily outlets, but continued losses have now prompted another round of cuts.
This latest announcement adds to a series of restructuring moves by the supermarket. Earlier this year, it closed more than 100 in-store cafés, pharmacies and other services, while also consulting on up to 200 job cuts at its Bradford headquarters as part of a wider efficiency drive that includes automation and AI-led processes.
Despite the closures, Morrisons insists its convenience strategy remains intact. The company operates around 1,700 convenience stores and nearly 500 supermarkets nationwide and employs about 95,000 staff. It says future growth will focus on franchised stores, arguing that removing weaker locations will strengthen the overall business.
The decision highlights growing strain across the UK retail sector, where higher wage costs and tax changes are reshaping business models. Smaller retailers, in particular, are expected to feel similar pressures as they adapt to rising operating expenses.
