The shock news comes amid reported consistent losses for the store and changing shopping habits.
Swedish furniture brand IKEA is to close its store in Coventry this summer, the first big UK closure it has ever done, in response to changing shopping habits and consistents losses at the store.
352 jobs will be affected by the closure.
Given the store’s location and the size of the land available at the time of construction, the store was built over seven levels, which resulted in a significant impact on the operating costs.
In addition, the changing behaviour of customers who prefer to shop in retail parks and online has resulted in visitor numbers being substantially lower than expected and continuing to decrease over time. These factors have led to the store making consistent losses.
The retailer has tried a number of initiatives over the years to drive sales growth and make the store more cost-efficient, such as moving various business operations to the site, however, these have not resolved the fundamental challenges.
IKEA has also looked at options for downsizing or reconfiguring the store, but the nature of the site means this is not a realistic option.
IKEA will now enter a period of consultation with the 352 co-workers affected by the closure to discuss the proposals and next steps. IKEA has the ambition to retain as many people as possible within IKEA and, where this isn’t possible, support them to find new employment.
Marsha Smith, Area Manager IKEA UK and Ireland said, “As we go through this process, our priority is to support our co-workers in the Coventry store. Our ambition is to retain as many people as possible within IKEA, and where this isn’t possible, support them to find new employment. We will work closely with our co-workers, impacted suppliers, unions and other trusted partners to ensure all our co-workers receive all the support they need.
“We feel privileged to have been part of the community for the last 12 years and I would like to thank our co-workers, customers and partners, who have contributed throughout this time.”
Ikea spokesman Peter Jelkeby said: “The proposed closure of the store has not been an easy decision, particularly given the impact it will have on our co-workers. I would like to thank our Coventry co-workers who have contributed enormously throughout this time.
“Although this isn’t an easy decision, this is the right decision for the long-term success of IKEA in the UK.
“At IKEA, we are constantly challenging ourselves to find ways to meet the needs of our customers and we will continue to try and test, investing in stores, fulfilment centres, city centre formats and our digital capabilities to make IKEA even more affordable, convenient and sustainable.”
Until the summer, the store will remain open for business as usual.
Following the closure, the closest IKEA stores to Coventry will be IKEA Nottingham, IKEA Milton Keynes and IKEA Birmingham.
In addition, IKEA is exploring alternative ways for customers in Coventry to shop, such as the introduction of collections points where customers can order online and pick up their products from convenient places across the city.
More information on the proposed store closure and introduction of collection points will be announced in due course.
It is thought that such a large building becoming unoccupied will be a big blow to Coventry city centre, with near to no companies being willing to occupy such a large space especially considering the building’s exact specifications to fit IKEA.
In a tweet, Taiwo Owatemi, MP for Coventry North West, said: “I am writing to the Government & IKEA to make sure that workers are supported into new jobs.”
“The government must do more to stabilise the economy and provide more than reassurances that the UK is still a great place to invest.”