Catalogue store group Argos intends to close its Castleford distribution centre in Yorkshire following a strategic review.

Argos, owned by Home Retail Group, is likely to shut the warehouse, which employs 407 people, in September after consultation with staff. The retailer’s five other distribution centres will take on its workload.

The Castleford centre is also home to Argos’s jewellery handling operation, employing 157 staff. The operation will be moved to new local premises and its staff retained.

Argos said that Castleford serves “significantly fewer” stores than its other centres and that its closure was the best way to ensure that its distribution network was “set up to deliver the most effective service to customers in the long term”.

The retailer said it would work with job agencies and employers to help find local opportunities for affected staff.

Argos’s supply chain is one of the most admired in the industry and has been key to its success.

Other store groups, notably Tesco through the launch of its Direct arm, are attempting to muscle in on Argos’s market, but the chain has so far held its own.