Morrisons cuts 54 cafes and 3,600 jobs amid cost pressures

The retailer is closing in-store cafes and Morrisons Daily stores as part of a broad cost-cutting drive, affecting thousands of workers.

Morrisons cuts 54 cafes and 3,600 jobs amid cost pressures

Morrisons will shut 54 in-store cafes and several Morrisons Daily stores across the UK as part of a broader cost-cutting drive. The moves will affect more than 3,600 roles and include cafes in Wales at Caernarfon, Brecon and Connah's Quay.

The closures come as Morrisons reports a return to profitability for the year ending 27 October 2024. The company posted a pre-tax profit of £2.1 billion, helped in large part by the sale of its petrol forecourts to Motor Fuel Group. Underlying performance also improved, with losses from continuing operations halved to £538 million and like-for-like sales up 3.9%, total sales up 4.2% to £3.9 billion in the second quarter. The workforce shrank from 104,819 to 101,144 across stores, manufacturing, distribution and head office.

Chief executive Rami Baitieh said the focus remains on delivering value to customers in a challenging economy marked by inflation and subdued spending. Earlier this year Morrisons closed 17 Morrisons Daily stores and signalled further cafe closures as part of a sector-wide move to cut costs. The broader retail landscape shows Aldi, Tesco and Sainsbury's also trimming jobs, underscoring a belt-tightening phase across the industry.

The decision to close cafes and trim jobs reflects a broader squeeze on physical spaces in grocery retail. While profit improvements are real, they lean heavily on asset disposals rather than a robust rebound from core store operations. The closures could ease near-term cash flow but may undermine the everyday value proposition Morrisons offers, especially for shoppers who rely on cafes for convenience and social spaces.

This trend signals a shift in how retailers balance efficiency with community presence. As chains tighten belts, workers and local customers bear much of the burden. Policymakers, unions and local authorities may scrutinize the social impact of turning once-active spaces into leaner, cash-focused models. The long-term question is whether margins gained through closures translate into durable growth or simply mask weaker core performance.

Highlights

The next quarters will show if cost-cutting can sustain value without hollowing the community spaces customers rely on.