The Derbyshire-based chocolate maker has announced the closure of at least 120 stores over the next three years across the country as part of a strategic review of the business.
The Thorntons PLC Strategy review, released today, states that a further 60 could also be closed as the leases expire. The move comes two months after the company suffered a like-for-like sales decrease of 12.6% in the first quarter of 2011, where unusually hot weather was blamed as well as Ice-cream sales failing to offset fall in demand for chocolate.
With regard to those that make the chocolate at the Derbyshire plant, the review states: “Our plan has been developed to ensure that we maintain and grow our factory production levels within current capacity as we rebalance the business across all channels.”
After purchasing their first robotic packaging line at the factory in Derby in 2004 and then investing in a second line in 2009, the blow of redundancies may be a little less sharp than anticipated. The international market for chocolate is another cause of optimism for Thorntons. As emerging economies generate increasing demand for luxury consumer products, the company may move to increase its exports. The review stated: “We foresee continued steady [international] growth [in sales] in the short term and will be investigating the potential over the medium and longer term.”
Jonathan Hart, Thorntons’ chief executive, commented: “Thorntons is a strong, trusted and highly valuable brand with excellent potential. Our goal is to refocus the business across all channels and seek to deliver industry competitive returns over the next three to five years.”
“Although we see the prospect of weakness in high street footfall and consumer sentiment continuing, I am confident that this strategy is right,” he added.