Debenhams to get tough with councils over closures

By

Sandra Halliday

Published
Feb 27, 2020

Debenhams is losing patience with local councils and the high level of business rates as it works to right-size its operations and make its remaining stores profitable.

The department stores chain is preparing for talks with councils and could say that if business rates aren’t lowered, more local stores could close. Its rates bill is still reportedly around £70 million even after an initial 22 stores have closed.

Sky News said the company is also in talks with landlords to achieve further rent cuts on top of those agreed last year. 

Sky’s sources said that the readiness of councils to go along with what the retailer wants could influence where it chooses to retain or axe the remaining 28 stores it’s going to close. 

The company has said that “we are currently working to identify the remainder [of stores to close]. Property costs, both rent and rates, are a huge burden for retailers and as such have an important influence on whether stores are profitable or not, and therefore we are planning discussions with councils and landlords to identify how stores could operate profitably going forward.”

Sky said people close to the retailer described the tone of the conversations as "constructive" and denied they were all about delivering an ultimatum.