Sainsbury’s is to cut more than 1,000 jobs at head office as part of a fresh efficiency drive designed to save £500m.
The UK’s second-largest supermarket chain has drafted in McKinsey, the management consultancy, to draw up a headcount reduction plan. All the big supermarket chains have announced job cuts in recent years as they seek to compete with the fast-growing discounters Aldi and Lidl.
In March, Sainsbury’s said it was cutting 400 jobs in store while another 4,000 workers would face changes to their working hours as it looked to run its supermarkets more cheaply. The changes included scrapping the night shift in 140 supermarkets.
Sainsbury’s will reach the end of a three-year plan to save £500m in March 2018 but Mike Coupe, the chief executive, has said the company will then embark on a new programme designed to save the same amount again.
Sainsbury’s has 3,000 back-office staff spread across a number of sites including Holborn in central London and a human resources support centre in Manchester. It also has an IT team based in Walsgrave, Coventry and a banking division in Edinburgh.
Sainsbury’s will confirm the exact number of job losses next month, according to the Sunday Telegraph. Employees involved in human resources and staff training were being targeted, it added.
“We do not comment on speculation and would always make any announcement around jobs to our colleagues first,” Sainsbury’s said.
Under the leadership of Coupe, Sainsbury’s has sought to broaden its appeal with last year’s £1.4bn purchase of Argos. The deal reduced Sainsbury’s reliance on the highly competitive grocery market and also gave it access to Argos’s fast delivery network. It is analysing the books of convenience chain Nisa before a mooted £130m deal.
Sainsbury’s is the preferred bidder for Nisa, which is owned by its shopkeeper members, but its period of exclusivity is thought to expire at the end of this week. Last week, Nisa was dealt a blow by McColl’s, its biggest customer, which announced it was transferring contracts worth 40% of its sales to Morrisons.
