Managing IT Equipment Following Store Closures

The Co-Op Group have come to public attention after recently making a deal to sell 298 of its smaller stores to McColl’s convenience brand.

In order to raise funds to reinvest into their remaining 3000-odd stores and catch up with targets and brand values, Co-Op have made the decision to sell on their underperforming and empty stores to the McColl’s group for the sum of £117m. This has, of course, been a best-case scenario, with no stores having to close permanently, and no staff put out of work. But having only revamped their IT systems a few years ago, does this move leave Co-Op’s equipment in limbo, and what should be done under such circumstances?

The Co-Op Group overhauled it’s IT provision back in 2009, subsequent to the group’s acquisition of Somerfield. This equipment is still in place to this day, with plenty of lifespan ahead of it, and a considerable amount of money invested. Surely it’s not all going to waste? Well, there’s no official word yet of what will become of the IT equipment in the stores being sold to McColl’s. However, it has been assured that all staff will be keeping their jobs on identical terms to before, so it can be hoped that all pre-existing IT equipment will also be kept on, and refreshed if need be.

The Co-Op’s approach is an interesting one, as it has not signalled the closure of the whole company, such as the scenario faced by Woolworths. With the aim to give the brand a nudge back in the direction of their original values, the least valuable assets have been passed on, allowing more time, money and resources to be spent on the remaining stores. In some circumstances, this is a wise business strategy to take.

It can be an effective way to concentrate resources on a particular part of the company, and to give staff, stores and IT equipment a new lease on life. In such cases, an IT service provider can take care of equipment, and repair and/or refurbish it, making it once again fit for purpose, eliminating the need for further equipment expenditure.

In situations like this, where a retailer is taking steps to reorganise their assets and streamline their business, external IT service providers are often best positioned to determine the ideal way forward when it comes to assessing and redistributing IT assets.

There are plenty of factors to consider when evaluating what IT assets should be retained and which can be sold on and making the right decision can make the difference between financial loss and positive new beginnings for the business.

Sources:
http://www.bbc.co.uk/news/business-36789684
http://www.telegraph.co.uk/business/2016/07/13/co-op-sells-298-stores-to-mccolls-retail-in-117m-deal/