Thorntons’ new chief executive Jonathan Hart has begun a strategic review of the chocolatier that will reshape its property portfolio and emphasise its “uniqueness”.
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Hart, who started last month, said in the next four years leases were up for renewal on 220 of its company-owned stores, 60% of the total. He said: “We will go through the estate on a store-by-store basis and address each one on a fit-for-purpose basis.”
Hart, who was previously managing director of Caffè Nero, said it was impossible to say how many stores would close until the review was complete in Thorntons’ second half.
He said: “The portfolio will be smaller than it is today but the retail part of our business is significant, and will continue to be significant.”
Thorntons has 371 company-owned stores. Its total sales fell 5.9% to £74.1m and like-for-likes were down 5.2% in the 28 weeks to January 8, when the snow took a toll.
Hart said since its Christmas sales update in the middle of last month, retail trading had been weaker than anticipated and he was cautious about the remainder of the year.
Some of the leases could be renegotiated, some stores resited and some close. The property review mirrors that of other retailers that are overhauling their portfolios. Retailers including Arcadia, Game and HMV are reviewing stores when leases come up for renewal.
Hart will also review Thorntons’ products, categories, promotions and customer experience.
He said: “We want customers to rediscover some of the uniqueness about Thorntons that has been lost.”
He gave the example of personalisation of products. At Easter, the retailer’s promotional message will be focused on how customers can personalise their eggs. He also said promotions would be “sharper”.
Thorntons celebrates its 100th birthday this year and the anniversary will be marked by promotions.
Thorntons reported an 8.5% fall in pre-tax profits to £8.3m in the first half, when sales rose 4.8% to £133.5m. It said the snow resulted in incremental supply chain costs of £500,000. Full-year profits are likely to be similar to last year, about £6m.