Nespresso reducing workforce by over 200 in Britain due to shop closures
Nespresso Adapts to Changing Landscape, Announces Closures and New Concept
In a strategic move to streamline operations and adapt to changing shopping preferences, Nespresso, the UK arm of the Swiss-based coffee giant, announced the closure of 11 locations and a reduction of its workforce from 716 to 499 employees in 2024. This decision was part of a broader strategy to provide high-quality and good-value products to consumers while navigating the complexities of the external environment.
Despite the closures, Nespresso's UK turnover saw a slight increase, rising from £306.1 million to £309.9 million in 2024. This growth was primarily driven by the ongoing success of the Vertuo system in its business-to-consumer division and strong growth in its business-to-business activities.
The company's overall turnover also increased slightly, from £338.6 million to £340.7 million in 2024. However, sales in the rest of the world dipped from £32.5 million to £30.8 million during the same period.
In a positive development, Nespresso's pre-tax profit increased from £14 million to £15 million, marking the 12th year of consecutive increase. The company also issued a dividend of £10.3 million to its parent company, a slight decrease from the £11 million paid out in 2023.
The coffee industry, including Nespresso, faces numerous challenges in the current environment. Inflationary pressures, increased costs, impacts of climate change, supply chain complexities, and geopolitical uncertainties are just a few of the hurdles the industry must overcome. One significant challenge is the rise in indirect taxes, including extended producer responsibility costs, which are expected to pose a significant challenge for the entire industry.
Amidst these challenges, Nespresso continues to innovate. The company recently entered the on-the-go coffee market with the launch of a new coffee shop concept titled 'The Nespresso Bar' at a location close to Liverpool Street station in central London. This move is part of Nespresso's commitment to providing immersive brand experiences to its customers.
While specific information about the company's current headcount or the number of sites it operates was not available, it is clear that Nespresso is adapting and evolving to meet the needs of the modern consumer. As the company continues to navigate the complexities of the global market, it remains committed to delivering high-quality coffee products and experiences.
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