Did you hear, Homebase support center in Milton Keynes is closing down. The brand has been in trouble for a while, like many high street retailers they failed to fully grasp the opportunity of growing their online business, and have now paid the price.
Homebase has been sold by its Australian owner Wesfarmers to retail restructuring firm Hilco, the deal, for a nominal sum thought to be £1, so the total P&L loss to Wesfarmers will be around £230 million - ouch!
In the UK it's said Homebase has 250 stores and employs around 12,000 people. The support team is at Milton Keynes, Snowdon Drive, Winterhill, and there are a total of 303 jobs which are already highlighted to be chopped.
"As part of the deal, a total of 24 stores that were trading as Bunnings, the Wesfarmers’ brand, will convert back to the Homebase stores. The DIY chain has said the job cuts are related to the withdrawal of the Bunnings brand from the UK. The support center will now only need staff to serve the Homebase brand."
However, 303 seems like a lot of support staff for 24 stores to me ... probably another reason why they were operating at a loss - So far 17 stores have already been shut with plans to close around 23 more.
The way Westerfarmers went after the acquisition of Homebase is now seen as one of the most disastrous retail takeovers, next to Tesco’s trying to break the US market with their Fresh & Easy concept.. as if they go for "fresh" in the states!
Wesfarmers promised to spend £500m on the Homebase chain giving it a much needed facelift. BUT a tough UK market coupled with a slowdown in house purchases, left the group struggling to get any traction at all again giants like Wickes and B&Q.
Homebase is not actually closing down. It has been sold, Hilco are the same retail turnaround specialist that picked up the HMV music chain when it was on it's last legs.
The stores closed, staff were cut, but the brand survives. That was the story with HMV, which continues to be a shadow of its former self. I trust the same will be said of Homebase in a couple of years. They'll be smaller, less stocked, and obsessed with signing you up for some random loyalty program.