An Ellesmere Port store which offered a taste of Scandinavia when it opened its doors last October is shutting up shop.
Netto opened in the Port Arcades opposite Asda nine months ago, bringing 20 new jobs to the town.
But supermarket giant Sainsburys has now ditched its tie-up with the Danish discounter, meaning all 16 UK Netto stores are to close next month, putting 400 jobs at risk.
Founded in Denmark in 1981 and now one of Europe’s largest retailers, Netto employs 32,000 people in Denmark.
It teamed up with Sainsbury’s to return to UK shores in 2014, having departed in 2010.
Reporter Graham Hiscott on the Pioneer’s sister paper the Mirror suggested the joint venture had been billed as an attempt to muscle in directly on the booming discount grocery market but Sainsbury’s had changed their minds after two years.
The supermarket group said the decision came after looking at Netto’s sales and other factors.
The joint venture was announced just before Mike Coupe started as Sainsbury’s chief executive in July 2014 but he was the man who made the decision to wield the axe.
Mr Coupe is reported to have said: “To be successful over the long term, Netto would need to grow at pace and scale requiring significant investment and the rapid expansion of the store estate in a challenging property market.”
Sainsbury’s has slashed the value of its Netto investment from £20m to zero and expects to be hit with another £10m of costs in winding down the business.
Fraser McKevitt, of grocery experts Kantar Worldpanel, said: “Even with Sainsbury’s help, Netto couldn’t match the competition it faced from the likes of Aldi and Lidl.”
The decision comes as Sainsbury’s is taking over catalogue chain Argos, which has a store in the Arcades. Aldi is close by on the market car park.
At the store’s opening last October, then mayor Lynn Clare was on hand to do the honours and tour the aisles with Netto UK managing director Morten Moeberg Nielsen, while youngsters from William Stockton Primary joined in the opening celebrations als well as with Netto’s giant Lego Scottie, the biggest Lego dog in the world.
Les Lyon, Port Arcades Shopping Centre manager said: "We are very disappointed to hear of the decision to close all of the UK Netto stores. The shoppers of Ellesmere Port had very quickly made the store here a favourite and I am sure they will join us in expressing the hope that all of the staff will find new employment in the very near future."
Sainsbury’s helped with sourcing products and finding new outlets.
