IKEA has said it will close its Coventry store, with the loss of over 300 jobs.
The Swedish retailer said a restructuring of its UK operations would see the store close this summer.
It added 352 jobs would be affected.
It claims the store has run at a loss because of its size at seven storeys.
The flagship store was the retailer’s first city-centre operation when it opened in 2007 off the ring-road.
In a statement to the Observer, Ikea said:
“IKEA’s Coventry store, one of 22 IKEA stores in the UK, was built in 2007 in the city centre and was one of the retailer’s earliest examples of testing a new format to meet its customer’s changing needs and expectations.
“However, given its location and the size of the land available at the time, the store was built over seven levels, which resulted in a significant impact on the operating costs of the store and the shopping experience for customers. In addition, the changing behaviour of customer in the area 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 connected to the location and the format of the store. 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.”
It added: “During the consultation period, the Coventry store will remain open, before the proposed store closure in summer.”