1,000 jobs at risk after Tesco buys Paperchase brand


Around 1,000 jobs at Paperchase are under threat after Britain's largest supermarket swooped for the struggling stationery company in a deal expected to close stores.

Tesco said it had bought the Paperchase brand and intellectual property, and expected to start rolling out new products in its UK stores. The announcement came just hours after Paperchase collapsed into administration earlier today.

Tesco's Jan Marchant said: “We have been building out plans to bring more brands and inspiration to the ranges we currently offer, and this will help us to take those plans further. We look forward to sharing more with our customers in due course.”


However, the deal is understood to not include Paperchase's 100 stores, where it employs more than 800 people, or concessions, casting doubt on the future for an estimated 1,000 workers. Around 75 staff based at its head office in London have been made redundant for now.

The deal came after Paperchase was unable to find a buyer for the whole business. PricewaterhouseCoopers had been running a sales process in recent weeks, although Paperchase had also been lining up administrators at Begbies Traynor.

The company on Tuesday said it had appointed Mark Fry, Kirstie Provan and Gary Shankland, of Begbies Traynor to handle the administration process.

Begbies Traynor, which was appointed administrators earlier today, said the sale reflected the interest in the brand and would mean it could still be seen in Tesco stores in the UK.

It said it would keep trading Paperchase's operations in the short term “with all stores remaining open and trading as normal”, and would be monitoring trading in the stores.

It is planning to retain all those staff in the Paperchase stores as they continue to trade, selling stock already in stores, as well as those roles which keep the stores running. However, unless a further deal is done for the stores, which may prove difficult without the Paperchase brand, a thousand jobs are expected to be lost. 

The deal is the latest twist for Paperchase, which only changed hands last August, when it was taken over by a consortium led by Jigsaw chairman and turnaround expert Steve Curtis.

It had previously been rescued out of administration by lender Permira, who bought the business in a pre-pack deal in early 2021. At the time, Paperchase closed around 40 stores. It now trades from just over 100 outlets and employs around 820 people.

The swoop by Tesco, which will see it add more stationery products to its lines, comes amid growing pressure on supermarkets to lure shoppers back, after facing mounting competition from discounters Aldi and Lidl.

Figures released on Tuesday showed that sales were up around 6pc at Tesco – significantly lower than the more-than-20pc growth at both Aldi and Lidl, as the cost of living crunch sends more shoppers hunting for bargains.

Tesco has been scrambling to cut costs in a bid to keep prices lower for shoppers, and on Tuesday announced it was axing deli counters in its stores, affecting around 2,100 roles.

It is planning to cut the number of lead and team managers in large shops as part of an overhaul of its management structure, which will impact around 1,750 workers.

Tesco said it will also introduce around 1,800 new shift leader roles in stores, who will be in charge of operational duties on the shop floor.

It will close its remaining counters and hot delis at stores from February 26, having previously removed counters from the majority of shops. Tesco first began reviewing its counters in 2019 and said it had seen a “significant decrease in demand” for them over the last few years.

Most stores have already closed all their counters and the ones left were often only open on selected days and at reduced times.

Tesco said all affected workers will be offered alternative roles. It did not say how many staff work on counters and delis.

The retailer also said 350 workers will be impacted by a series of localised changes, such as the closure of eight pharmacies and reduced hours at some in-store post offices.

Jason Tarry, Tesco chief executive of the UK and the Republic of Ireland, said: “These are difficult decisions to make, but they are necessary to ensure we remain focused on delivering value for our customers wherever we can, as well as ensuring our store offer reflects what our customers value the most.

“Our priority is to support those colleagues impacted and help find alternative roles within our business from the vacancies and newly created roles we have available.”