Bunnings is planning to close seven stores across New Zealand, it announced on Tuesday.
The company said the closures are largely due to the challenges of the recent trading environment.
In a statement, Bunnings confirmed that the stores earmarked for closure are the Ashburton Warehouse, the Hornby and Hastings trade centres and four smaller stores, located in Cambridge, Rangiora, Te Awamutu and Putaruru.
Bunnings said that the decision followed a network review, which looked at the recent economic challenges along with lease arrangements, store performance and location. For some stores, the location was always intended to be temporary.
Bunnings New Zealand director, Jacqui Coombes, said that consultation with the company's 145 team members impacted by the decision would begin on Tuesday.
“This news is understandably upsetting and we will be working closely with our team during the consultation period to discuss their individual circumstances, including deployment to other stores if possible," Coombes said.
She said that team members had put in "incredible efforts", but despite this, the impacts of COVID-19 had increased challenges at the seven stores, making them no longer viable.
"While we have been able to leverage the financial position of the Bunnings network and the government subsidy to support our team throughout Level 3 and 4 restrictions, ultimately we have to make the best decision for the long-term performance of our business moving forward which employs close to 4500 people,” Coombes added.
The decision to close the stores follows a company review in late 2019, which resulted in the closure of three smaller stores, located in Te Aroha, Waikanae and Paeroa.
Prior to Tuesday's announcement, the company had cut costs in an effort to recoup trading conditions worsened by COVID-19. This included temporarily reducing hours and pay of salaried team members by 20 percent.
The company had also negotiated rent reductions with landlords.
Ashburton Mayor Neil Brown said that news that the Ashburton Bunnings store is earmarked for closure is disappointing, as it would result in loss of jobs at a time when local unemployment is rising.
"Other businesses have scaled back on staff numbers, as they're not certain what their business will be like going forward," Brown said.
He believes that the Government should step in further to help small and medium-sized businesses to "get over the carnage" of COVID-19.
A buy-local campaign called 'Mid-Canterbury open for business' has been developed to support local businesses.
"It has 220 local businesses signed up to it already and is there to show shoppers what's open and ready to go as soon as they're able to [operate] under level 2," Brown added.