UP to 230 staff are under threat after
Virgin revealed plans to axe its retail brand Virgin Travelstore.
Blaming a dying retail sector, Virgin director of
corporate affairs Paul Moore said the division had been accumulating losses “in
the millions” over the past three years due to an “imploding” travel retail
sector.
He said pressure from low-cost airlines, direct sales
and the Internet will continue to squeeze the sector and focus will now be
turned to Virgin Atlantic and Virgin Holidays.
The majority of retail bookings come through its
Norfolk-based 100-strong call centre, but it also has a couple of high-street
branches, one in London and another in Norfolk.
Staff were notified at two separate meetings at its
Norfolk and London offices on June 28. At the Victoria office at 5pm the doors
remained closed and lights were off as staff were briefed in an upstairs
office, despite customers attempting to gain entry downstairs.
It’s believed staff thought they would be told about
new company premises in Norfolk.
One insider told Travel
Weekly: “It’s going to be devastating for the Norfolk
community. It’s outrageous Sir Richard Branson would treat his staff this way.”
All staff, including managing director Peter Davies
and commercial director Carol Smallman, will undergo a statutory 90-day
consultation period, with Travelstore expected to close at the end. Smallman
declined to comment.
Flightstore will return to being run as part of Virgin
Atlantic. The 30-40 staff
working for Flightstore are included in the
consultation process, but Moore said the brand will “almost certainly” not be
scrapped.
“The board felt investment should be placed in the
airline. Travelstore has been bringing down the other Virgin companies and has
been making losses over a number of years.”
Moore said staff were “understandably upset”. He said
there were opportunities elsewhere in the group at Virgin Atlantic, which is
recruiting 1,400 new staff over the next year, and Norfolk-based call centres
Virgin Money and Virgin Wines.