Wm Morrison Supermarkets Plc plans to cut about 2,600 management jobs as the UK grocer seeks to reduce costs amid a slump in sales that caused it to announce £1 billion ($1.7 billion) of price cuts earlier this year.
Department manager and supervisor roles will be pooled together under a smaller tier of team managers, the Bradford, England-based Morrisons said in a statement today.
The changes will modernise the way outlets are managed, with the aim of reducing store management hierarchy and improving customer service, the company said. Some have seven tiers between the shop floor and store manager, it said.
Morrisons, the fourth-largest UK supermarket chain, has been hit hardest by the expansion of leaner German discount chains Aldi and Lidl, who have lured customers with lower prices and no-frills offerings. Discounters have about 50 per cent fewer staff than most British supermarkets, Exane BNP Paribas analyst Andrew Gwynn estimates.
The company is fighting back by cutting prices on products from broccoli to baby wipes, a strategy that, it said in March, would reduce profits by about half this year.
Morrisons' shares rose 2.8 pence, or 1.5 per cent, to 191.1 pence as of 2.10pm in London. They’ve fallen 27 per cent this year, headed for a third straight annual decline.
The grocer also said that it’s creating 1,000 jobs in its convenience-store unit and 3,000 positions in new supermarkets. Morrisons employs a total of about 126,000 people.
Bloomberg, edited by ESM
