Major card chain warns of MORE store closures due Labour pay and tax hikes – with two more shops to shut
A MAJOR gift card chain has hinted of more stores closures ahead of shutting another two stores.
Clintons, which returned to profit earlier this week, warned that rising costs driven by labour tax hikes and the increasing minimum wage continue to make some of its stores financially unviable.
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This warning comes despite the closure of 38 stores and the loss of over 300 jobs in the previous financial year.
The card shop, which was acquired by Pillarbox Designs in March 2024, announced a pre-tax profit of £8million for the year ending 29 June 2024.
This represents a significant financial turnaround from the £5.3million pre-tax loss reported in the previous year.
However, in its latest financial update, the company acknowledged the possibility of additional closures.
A statement from Clintons read: "The company has continued to close loss-making stores and the portfolio of retail stores is now down to approximately 170 stores.
"The high street continues to be unpredictable and the company is seeing reduced footfall in the stores year on year.
"The company continues to monitor the performance of the existing estate and to close the poor performing stores, which, whilst impacting on turnover, should improve profitability moving forwards."
Clintons in Keighley, West Yorkshire, announced earlier this month that it will be closing its doors on June 14.
In preparation for the closure, the store has launched a clearance sale, offering 20% off all items.
Meanwhile, "Everything Must Go" signs have been spotted at Clintons' store in Leamington Spa, where discounts of up to 50% are currently available.
However, the final closure date for the Leamington Spa location has yet to be confirmed.
In its latest financial update, the retailer also addressed additional challenges impacting its operations: "Like many other retailers, the company continues to face significant cost pressure on wages given the increases in the national minimum wage.
"Conversely, energy costs for the business began to ease during the year with the deal in October 2023 representing a material saving compared to the deal for the prior year."
Like many businesses, Clintons now faces higher employer national insurance contributions, which have risen from 13.8% to 15%.
Additionally, the threshold at which these contributions must be paid has been lowered from £9,100 to £5,000.
These changes to the tax system were confirmed by the Chancellor in the Autumn Budget last October and came into effect on 1 April.
At the same time, the national minimum wage saw a notable increase, rising to £12.21 per hour. For workers aged 18-20, the minimum wage increased by £1.40 to £10 per hour.
Clintons was first launched back in 1968 - and quickly became a go-to for Brits looking for greetings cards.
At one point, the chain boasted more than 1,000 branches across the country.
Clintons was contacted for comment.
EMPTY shops have become an eyesore on many British high streets and are often symbolic of a town centre’s decline.
The Sun's business editor Ashley Armstrong explains why so many retailers are shutting their doors.
In many cases, retailers are shutting stores because they are no longer the money-makers they once were because of the rise of online shopping.
Falling store sales and rising staff costs have made it even more expensive for shops to stay open.
The British Retail Consortium has predicted that the Treasury's hike to employer NICs from April 2025, will cost the retail sector £2.3billion.
At the same time, the minimum wage will rise to £12.21 an hour from April, and the minimum wage for people aged 18-20 will rise to £10 an hour, an increase of £1.40.
In some cases, retailers are shutting a store and reopening a new shop at the other end of a high street to reflect how a town has changed.
The problem is that when a big shop closes, footfall falls across the local high street, which puts more shops at risk of closing.
Retail parks are increasingly popular with shoppers, who want to be able to get easy, free parking at a time when local councils have hiked parking charges in towns.
Many retailers including Next and Marks & Spencer have been shutting stores on the high street and taking bigger stores in better-performing retail parks instead.
In some cases, stores have been shut when a retailer goes bust, as in the case of Carpetright, Debenhams, Dorothy Perkins, Paperchase, Ted Baker, The Body Shop, Topshop and Wilko to name a few.
What's increasingly common is when a chain goes bust a rival retailer or private equity firm snaps up the intellectual property rights so they can own the brand and sell it online.
They may go on to open a handful of stores if there is customer demand, but there are rarely ever as many stores or in the same places.
The Centre for Retail Research (CRR) has warned that around 17,350 retail sites are expected to shut down this year.
Beales, one of Britain's oldest department stores, has launched a closing down sale before it shuts its last remaining shop after more than 140 years.
The company will shut its branch in Poole's Dolphin Centre on May 31.
The sale includes fashion, furniture, gifts and cosmetics, being sold for up to 70% off.
Beales chief executive Tony Brown blamed the "devastating impact" of the rise in national insurance contributions and the higher minimum wage for the store closure.
Meanwhile, high street fashion chain New Look has begun to close stores as it scales back its UK footprint.
It is understood to be shutting nearly 100 stores - equivalent to around a quarter of its 364 shops.
Stores in Gateshead, Tyne and Wear, St Austell, Cornwall and Porth, Rhondda Cynon Taf have launched closing down sales.
Reports suggest that the company has been forced to accelerate the pace of store closures due to tax changes in the Autumn Budget.
Meanwhile, Huttons in London will shut its store in the Putney Exchange due to excessive energy costs.
The gift shop became a local icon after it opened in the 1990s.
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