Industry sources have responded in shock to the news that Clarks is considering closing its UK factory less than a year after opening, saying it is a missed opportunity for UK manufacturing as Brexit nears.
Clarks said last week that it is reviewing the facility in Somerset which employs 49 staff.
In a statement the business said: “Despite best efforts, we have determined that the levels of production and cost targets we hoped for will not be reached in the short-to-medium term. We are therefore proposing to cease production and close the facility, and will now enter a period of consultation into the viability of [the factory].”
Clarks announced plans for the manufacturing unit in 2017 and said it hoped the project would produce 300,000 of the brand’s iconic desert boots per year and employ up to 80 staff. The factory started production in summer 2018.
Kate Hills, founder of Make It British, said: “It’s a really odd decision after they invested so much money in it, it’s not been open long. With Brexit coming up everyone is talking about reshoring and importing is getting more expensive. I hope it doesn’t unnerve people who are thinking about investing in British manufacturing. There’s no indication that times are tough, British manufacturers are expecting a good year.”
The most recent Clarks figures revealed a loss of £31.3m for the year to 31 January 2018, down from a profit after tax of £26.5m the previous year.
“I think this news is more indicative of wider problems within Clarks than problems in the industry,” said John Saunders, CEO of the British Footwear Association.
“It’s sad news. Especially with Brexit around the corner, we were excited at the opportunity for bringing manufacturing back to the UK. If they’d made it work, it would have been a good vote of confidence for the business case for British manufacturing. The core of footwear manufacturing in the UK is still doing well though.”
Adam Mansell, CEO of the UKFT, echoed the positive mood for manufacturing while acknowledging the tougher climate faced by retail.
“Manufacturing is on the up in the UK, output is the highest it’s ever been. Lots of existing manufacturers are looking to expand and are working with clients all over the world. Setting up your own manufacturing unit is incredibly expensive, it might be that they’re pulling their investment because of problems on the high street.”
Rink Bindra, head of omni-channel at footwear independent Tower London which stocks the Clarks Originals range, said he’s seen sales dipping for the brand: “British heritage brands do sell but we’ve seen a backwards move in Clarks. They put the price up very quickly a while ago and customers find them expensive. Northampton traders are doing very well though, so people do want made in Britain.
“[Clarks] needs to cut their costs quickly, focus on core product and get back to basics.”