In a somber turn of events for the venerable Wilko chain, a rescue deal aimed at preserving its presence on UK High Streets has fallen through, spelling the end for the beloved brand. All 400 Wilko stores across the United Kingdom are set to shutter by early October, marking a significant setback for the company that has long been a fixture in the retail landscape. The GMB union, representing workers at Wilko, has announced that the closure of these stores will likely result in redundancies for all 12,500 staff members associated with the family-owned business.
Sources suggest that no potential bidders have expressed interest in maintaining the Wilko brand, though there is some interest in rebranding certain stores. Notably, Doug Putman, the billionaire owner of HMV, had aspired to keep around 300 Wilko shops operational. However, his bid faced insurmountable challenges as mounting costs complicated the proposed deal.
This week marks the onset of Wilko’s gradual disappearance from High Streets, with administrators PwC having previously disclosed that 52 stores across the country would cease trading during the week. Further closures are expected to be announced soon, intensifying concerns about the fate of Wilko’s dedicated workforce.
Wilko has grappled with fierce competition from rival chains such as B&M, Poundland, The Range, and Home Bargains. The strain on consumer wallets, driven by the high cost of living, has propelled shoppers to seek out bargains, a shift that has benefited these competitors. B&M, for instance, has laid claim to up to 51 of Wilko’s 400 stores in a deal worth £13 million. While the rebranding of these stores as B&M outlets appears likely, the fate of existing jobs and the preference for Wilko workers applying for roles at B&M remain uncertain.
Many of Wilko’s stores are strategically located in traditional town centres, catering to shoppers without access to personal vehicles. However, since the onset of the pandemic, consumer habits have shifted towards larger retail parks and out-of-town options, favouring competitors like B&M.
Poundland has also reportedly expressed interest in acquiring up to 70 Wilko stores, a move aimed at expanding its own portfolio.
Meanwhile, the fate of the Wilko brand itself remains undetermined, with several retailers, including The Range, considering bids for its name.
The uncertainty surrounding the future of Wilko has taken a toll on its employees. Workers, who have endured weeks of ambiguity, have been left feeling disillusioned and anxious, with one employee expressing disappointment in the lack of official information from the company, the union, and administrators.
Wilko’s financial woes came to the fore in August when it announced its collapse into administration, sparking concerns for the livelihoods of its extensive workforce. Thus far, over a thousand redundancies have been declared among the stores facing closure, with hundreds more at the company’s distribution centres and support centre.
The attempted rescue effort by Canadian entrepreneur Doug Putman faced formidable obstacles, including the need to revamp Wilko’s supply chains, escalating day-to-day expenses, rents, and supplier contracts. Mr. Putman expressed his disappointment in the failed bid, emphasising that a stable foundation could not be established to ensure the long-term success of the business and its employees.
Wilko’s story is one of resilience and adaptation, as it stepped in to fill the void left by the collapse of Woolworths in 2008. Founded in 1930, the brand was renowned for offering affordable everyday items. However, it faced substantial losses and a cash shortage in recent times.
Nadine Houghton, national officer at the GMB union, paid tribute to the dedication of Wilko’s staff, highlighting that the workforce had maintained the company’s cherished ethos until the very end. Wilko’s struggle for survival has been marred by criticisms over dividend payments in recent years, though former chairwoman Lisa Wilkinson has maintained that the company would have faced insolvency even without these disbursements. She acknowledged that exhaustive efforts had been made to secure the business’s future, but ultimately, the challenges proved insurmountable.