Morrisons is set to shutter its Rathbones bakery, imperiling 400 jobs. The company cites continued losses despite investment.
- Discussions for a possible acquisition by Hovis collapsed, leaving no recovery path.
- The company assures efforts will be made to reassign affected staff elsewhere within the Morrisons group.
- Morrisons assures that its Market Street bakeries will remain operational and unaffected by this closure.
- Despite exploring alternatives, the bakery’s pre-tax losses significantly influenced the closure decision.
Morrisons has announced plans to close its Rathbones bakery, a decision poised to affect 400 employees due to the facility’s persistent unprofitability. The decision follows a comprehensive review of the business, during which all potential rescue options were exhausted. Despite efforts to revive the bakery’s financial health, it remained in deficit, leading Morrisons to consider shutting it down.
Earlier in the year, there were discussions with Hovis for a potential takeover of the Wakefield factory. However, no agreement was reached, leaving Morrisons without a viable alternative to maintain the operation. The spokesperson noted, “The business has been loss-making for a number of years, and despite various attempts at restructuring, a turnaround has not been possible.”
The company is now in talks with 378 Rathbones staff to identify new roles within the broader Morrisons ecosystem. The spokesperson added that the company would explore every avenue to support its employees during this transition. Efforts include liaising with the union BFAWU to consider how the business model might be restructured to preserve as many jobs as possible, highlighting Morrisons’ commitment to its workforce.
Despite Rathbones’ closure, Morrisons’ 450 in-store Market Street bakeries will continue to operate, unaffected by the decision. Additionally, plans are in motion to potentially create a smaller, specialised bakery to maintain the production of certain bakery goods excluding traditional sliced bread. These steps underscore Morrisons’ strategy of adapting to market demands while managing its resources prudently.
Rathbones, purchased by Morrisons in 2005 after falling into administration, reported a pre-tax loss of £3.7 million for the year ending 20 October 2023. This financial outcome was a critical factor in the decision to close the facility, as the prolonged state of loss was deemed unsustainable in the long term.
The closure marks a significant shift in Morrisons’ operational strategy, with efforts focused on employee support and sustainable business practices.
