BrightHouse plans to shut around 10% of its store estate after a “challenging” 18 months for the business, Retail Week can reveal.
The rent-to-own retailer said it will close 28 of its 311 shops in March as it looks to cut costs.
The closures, which include the retailer’s West Ealing, Newcastle-Under-Lyme and Bristol Knowle branches, will put 150 jobs at risk.
The decision is part of a new strategy unveiled by boss Hamish Paton.
Paton, who took the helm last October when Leo McKee retired, hopes his three to five year plan will “set the business up for long-term sustainable growth”, following a “challenging 18-months”.
BrightHouse’s business practices were targeted by MPs in 2015. The retailer said last year that conducting more rigorous affordability checks on potential customers was hurting its business model.
Paton told Retail Week that Brighthouse will support the employees affected to find alternative roles, “either within the business or elsewhere”.
He said: “These were very difficult decisions and they were not taken lightly, but part of our plan requires us to be leaner and more cost effective.”
The retailer, which is owned by private equity firm Vision Capital, said the decision on which branches to close was based on commercial and financial performance, as well as proximity to other BrightHouse stores.
Paton insisted that there are no plans to close additional stores beyond the 28.
New ‘customer focused’ strategy
Paton’s new plan includes launching a fully transactional ecommerce platform.
The site, which will go live later this year, will allow customers to complete the BrightHouse sign-up process, as well as making payments and managing their accounts.
Paton said: “We have been heavily reliant on our store infrastructure but as we move forwards I want to ensure customers can interact with us both in-store and online.
“This is a really important marker for us as a business and will form a big part of our future.”
The retailer is also aiming to improve call handling, reduce administrative tasks, simplify the in-store “on boarding process” and offer customers more choice and flexibility.
Paton said: “We have to do different things and in different ways to deal with the challenges of evolving regulation and changing customer expectations.
“These changes will ensure we make the most of our advantages and set the business up for long-term sustainable growth.”
He added he is confident that demand for Brighthouse’s proposition “remains really strong” and hopes to see traction from the new strategy before the end of this year.