Supermarket chain closes after 40 years and lays off around 100 employees

The Spanish supermarket chain El Arco announced the closure of its operations, ending a nearly four-decade history in food retail. The closure of all 600 stores was confirmed this week, directly affecting around 100 workers.

Founded in 1987, the company gained market share by offering fresh products and an aggressive expansion policy, which included incorporating other brands and opening new units over the years. This growth, however, was not hampered by the financial imbalances that have accumulated in recent years.

Over the past two years, El Arco has attempted to reverse the situation with emergency measures. In 2024, the company sold 29 units and two logistics centers in an attempt to reduce its debt. The strategy, however, had limited effect: only 70% of its supplier debts were paid off.

With no products on the shelves and cash flow compromised, maintaining operations became unfeasible. The chain struggled to maintain supplies, which ultimately accelerated its permanent closure.

Unemployment and regional impact

The layoff of approximately 100 employees marks a significant loss for the job market in the locations where the chain operated. The closure also represents a disruption in regional economic dynamics, affecting consumers, suppliers, and competitors.

The demise of one of the sector's biggest names serves as a warning to retailers. In a constantly changing market, adaptability and financial control have become vital to the survival of established companies.