Morrison’s ambitious expansion in recent years looks to be under threat as the supermarket chain announces the closure of 11 of its stores.

First Tesco then Sainsbury’s and now Morrisons are starting to feel the pinch as the cost of some of its smaller stores are outweighing the potential profits they bring in. Morrisons profits overall have also taken a hit and fell further than some analysts predicted.

The Supermarket has already off-loaded most of its M Local stores, the closure of which may cost a total of 900 jobs. Profits fell by 35% overall as the competition among supermarkets get tougher.

The rise of value supermarkets like Aldi and Lidl is forcing the big 4 supermarkets to concentrate harder on their core supermarket business and stop the flow of customers to the budget sector where the shopping experience has caught up dramatically in recent years.

Another major problem has been leasing arrangements that have placed a heavy burden on local convenience stores that seem to have struggled in comparison to larger supermarkets.
This latest announcement doesn’t bode well for the big 4 supermarkets as well as Morrisons. Increased competition may be better for consumers, but it will continue to cut the market share of the big 4 unless they can figure out how to encourage consumers to spend more in their stores.