Major high street greeting card chain says it will close more stores

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Clintons Card Retailer Considers Further Store Closures Amidst Economic Headwinds

Greeting card and gift chain Clintons is preparing to shutter additional locations as it grapples with declining customer visits and an ‘unpredictable’ retail landscape.

In a recent financial statement, Clintons cited ‘substantial cost pressures,’ including increased employer national insurance contributions and rising wages, as key challenges.

Ongoing Store Rationalization

The company confirmed it has continued to execute its strategy of closing underperforming stores. Currently, Clintons’ store count is approximately 170, a significant reduction from its peak of around 1,000 stores.

During the last fiscal year, ending in June 2024, the greeting card retailer closed 38 stores and reduced its workforce by over 300 positions, bringing the total staff to 1,415.

During that same period, a court specializing in insolvency cases approved a restructuring plan aimed at stabilizing the business.

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High Street Challenges and Reduced Footfall

Clintons acknowledged the volatile nature of the high street, noting a continued decrease in year-over-year customer footfall in its stores.

The retailer stated: ‘The company continues to assess the performance of its existing properties and close underperforming stores. While this impacts overall revenue, it is expected to enhance profitability going forward.’

Easing Energy Costs Offset by Rising Employment Expenses

While the company is experiencing some increased expenditures, it indicated that energy expenses have begun to moderate due to an energy agreement secured in October 2023. This agreement provides ‘a significant saving compared to the previous year’s energy contract.’

However, recent government fiscal policy has increased employer National Insurance contributions from 13.8 percent to 15 percent, adding to operating costs for numerous businesses.

Furthermore, the threshold at which these contributions become payable has been lowered from £9,100 to £5,000.

The national minimum wage has also increased to £12.21 per hour. For workers aged 18 to 20, the minimum wage rose by £1.40 to £10 per hour this month.

Return to Profitability and Recent Closures

Earlier in April, Clintons announced a return to profitability after a difficult period that included restructuring and previous store closures.

This month, the Clintons branch in Keighley, West Yorkshire, announced its closure, scheduled for 14 June.

The specific list of other locations potentially affected by future closures remains undisclosed.

Company Performance and Wider Retail Sector Woes

Clintons, established in 1968 and acquired by Cardzone owner Pillarbox Designs in March 2024, reported a pre-tax profit of £8 million for the year ending 29 June 2024. This marks a significant turnaround from a £5.3 million loss in the preceding year. However, sales decreased by 14 percent, from £96.5 million to £82.6 million during the same period.

This is Money has reached out to Clintons for further comment.

Across the UK, retailers are facing a combination of increased operating costs and intense market competition, while many consumers are dealing with constrained disposable income.

Contrasting Fortunes in the Retail Landscape

In February, fashion retailer Quiz entered administration, leading to the closure of 23 stores and approximately 200 job losses.

Subsequently, the clothing chain entered administration before being partially acquired by its founder’s family, the Ramzan family, who bought back 42 stores and preserved roughly 1,300 jobs.

In March, it emerged that WH Smith, a long-standing fixture on British high streets, is poised to disappear following an agreement to sell its stores to Modella Capital, the owner of Hobbycraft.

The new owners intend to retain Post Office branches located within many WH Smith stores but will rebrand the retail chain as TGJones.

The WH Smith brand name will be retained for travel hub locations, which are not part of the sale.

Last week, the Post Office announced the sale of 108 ‘crown’ branches, currently owned and operated directly by the company.

The Post Office plans to transfer the remaining 108 directly-owned branches to franchisees by autumn.

Around 1,000 employees working in these branches will be offered the option to transfer to the new franchise operators or to take voluntary redundancy, according to the Post Office.