Dozens of jobs have been put at risk after Merseyside firm Appreciate Group announced it was stopping production of its famed Christmas hampers.
The firm, which last year changed its name from Park Group, made the announcement on Wednesday that all hamper and merchandise production at its Valley Road site in Birkenhead will cease by the end of this year.
Appreciate said despite the firm having been founded as a Christmas savings club back in the late 1960s, order volumes had “declined significantly” over a period of many years, and hampers were no longer considered a sustainable part of the business.
Valley Road will continue to house the firm’s voucher and gift card teams, after the Covid-19 pandemic had led to the “acceleration” in customers’ appeal for its digital products.
On Wednesday morning, Andy Hammerton, head of corporate affairs at Appreciate, said: “As a result of these proposals, we’ve made the difficult decision to put the people who work in our hamper and third party packing business at risk.
“Order volumes have been declining significantly over a period of many years and this is no longer considered a sustainable part of our business based on demands for the future.
“These sorts of decisions are never easy to make and we’ll be doing everything we can to give our colleagues all the support they need.”
From Park to Appreciate: A firm steeped in Mersey lore
In the late 1960s, Peter Johnson, a butcher’s son who later became chairman of Everton FC, founded a Christmas savings club by branching out the family business, which would go on to become Park Group.
He went about building a network of agents around the North West that soon went national.
It was centred around the idea that people could put money aside to afford meat for Christmas, which led to other goods and the concept of Christmas hampers.
Customers would go into a branch of the network of butchers with a voucher or letter detailing their credit.
Other retailers soon heard about the initiative and asked for their name to be put on the letters too.
That was at the same time as increasing hamper sales, which eventually grew to 1m units being shipped out of Birkenhead, making Mr Johnson one of the 海角视频’s richest people.
Now, Appreciate works with around 400,000 families saving for Christmas, also dealing with over 30,000 corporate entities. It’s also home to gifting and rewards products including Love2shop and Park Christmas Savings - now vital parts of the business.
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The group today revealed annual financial results to the year ending March 31, saying that trading for the 11-month period to the end of February 2020 was in line with expectations.
The final month of the financial year was impacted by the coronavirus lockdown.
The group said billings for the year were down marginally from £426.9m in 2019 to £419.9m, while revenues were up by 2.1% - from £110.4m last year to £112.7m this.
Profit before tax stood at £7.7m - down from 2019’s £11.3m.
It said total billings had “progressively recovered” as the lockdown eased - after being 48% down at the end of the first quarter of the new financial year.
It’s been a busy week for the firm, which revealed a revolving credit facility with Santander on Monday, before announcing the sale of buildings and land at its former Valley Road headquarters, with the disposal of group subsidiary Budworth Properties.
The Covid-19 crisis saw the company furlough around 80 people in April, before a phased reopening of operations from May.
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The company said it had decided not to recommend a final dividend given the “continued short-term uncertainty” from Covid-19.
The board said its strategic business plan was “well advanced”, and that it was “confident” it would become a “bedrock of strong and sustained future growth”.
Ian O'Doherty, CEO, said: "We've made significant progress in implementing our strategy to adapt our business for the future. Our focus on digital products and delivery has intensified, and we've accelerated our development of smarter, more efficient ways of working.
"This will position us well for doing business after Covid-19.
"Our continued investment in transformation, with changes to logistics and operations completed, is already showing significant benefits.
"Whilst our performance has been interrupted by the lockdown, we have seen trading start to recover and expect the resumption of growth founded on the more robust and scalable business model.
"We are confident that delivery of the strategic business plan will be the bedrock of strong and sustained future growth."