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The Guardian - UK
The Guardian - UK
Business
Sarah Butler

Wilko plans to cut 400 jobs as part of restructuring after fall in sales

wilko shop front
Wilko employs about 16,000 staff in the UK. Photograph: Maureen McLean/Rex/Shutterstock

Wilko plans to cut more than 400 jobs, including assistant store managers, retail supervisors, head office managers and call centre workers, in the troubled retailer’s latest effort to control costs.

The value household and garden products retailer has told staff it plans to reduce hours for team supervisors in 150 of its 401 stores, leading to the equivalent of about 150 full-time equivalent job losses, after a fall in sales.

The cuts also include about 150 assistant store managers, around 95 workers from its contact centre in Worksop, Nottinghamshire, whose work is being outsourced to a South African company later this month, as well as dozens of head office management roles across commercial, retail operations, merchandising, marketing and finance.

One member of staff said the changes in stores and the head office, on which a consultation began this week, came as “sales remain poor and rumours are rife about the future of the business”, which has been struggling to pay suppliers.

Mark Jackson, the chief executive of Wilko, said: “We’ve identified significant changes to the Wilko operating model to enable us to stabilise the business and then thrive again. This includes some proposed changes to our management structure at both our stores and head office.

“We’re fully supporting affected individuals. We know change will be unsettling to our team members and the wider business, and we’re acting swiftly to put in place the new organisational structure to stabilise and grow.”

The GMB union said it was consulting with Wilko, which employs 16,000 staff in total, in an effort to reduce job losses.

“Wilko is going through significant changes at the moment and ultimately the business is in a fight for survival,” said Nadine Houghton, GMB national officer.

“We are seeing continued and increasing job losses throughout the retail sector and this is something that warrants an urgent, strategic response from the government.”

The cut-price retailer borrowed £40m from restructuring specialist Hilco and rejigged its leadership team as it faced a cash squeeze after falling to a loss.

At least one credit insurer has withdrawn cover for the retailer, prompting some suppliers to pause deliveries. Wilko told suppliers in a meeting before Christmas that it was “debt free” but did not have sufficient funds to pay them upfront.

Former Bensons for Beds chair Chris Howell has taken over from Lisa Wilkinson, a member of the founding family, as chair, after another former Bensons executive, Mark Jackson, stepped in as chief executive before Christmas, the group’s third in three years.

Wilko’s struggles come as the number of shoppers out and about remains more than 10% below pre-pandemic levels.

While consumer spending has been better than expected in recent months, retailers say shoppers are being cautious about what they buy amid rising energy bills, food costs and mortgage rates.

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