Halfords has announced a proposal to close its Cycle Republic and Boardman Performance Centre brands following a strategic review.
The London-listed autos and bicycle retailer said the proposal links directly to its strategic update in November 2019.
At the time, it outlined its intention to improve the profitability of its cycling business. It said the proposed closure of Cycle Republic reflects the challenging economics of a store-based dedicated performance cycling operation.
The firm said that exiting a low-returning, stock intensive business will allow it to improve its return on capital.
This would also free up investment and resources to continue to drive its services-focused strategy; with an emphasis on accelerating the growth of our motoring businesses.
The firm currently serves the enthusiast cycling market through Tredz, a predominantly online business; and through Cycle Republic, a commuter led, store and online offer.
Halfords said it want to focus its investment and resources into the Tredz brand.
With investment in the Tredz business, alongside its core Halfords Retail cycling business, the firm said it will be uniquely placed to serve both the enthusiast and the mainstream customer in a more economic way than we do today.
It has launched a consultation process with the 226 colleagues affected by the proposal. The aim, it said, is to mitigate redundancies where possible.
The firm is also actively exploring opportunities to sell the sites as a going concern. Depending on the consultation outcome, the stores are expected to close during the first half of next year.
“The Board has come to the difficult, but necessary, decision to propose the closure of Cycle Republic, our retail store-focussed performance cycling brand”, said Halfords CEO, Graham Stapleton.
“This proposal is not a reflection of the hard work of our Cycle Republic colleagues, who I would like to thank for their commitment and passion in serving our customers.
“We are now moving into a period of consultation with impacted colleagues with a view to mitigating as many redundancies as possible.
“Going forward we propose to focus our investment and resources in Halfords and Tredz, through which we will deliver market-leading specialist propositions for both mainstream and enthusiast cyclists via a business model that improves our overall economics.”