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Asda announces radical restructuring

Article By: ,  Financial Analyst
July 4, 2014 10:15 AM

Asda is set to embark on a major restructuring of its management team with over 1,000 jobs being put at risk.

The supermarket chain is conducting this radical shake-up as it looks to compete with the rise of online shopping and changing shopper habits. The move is likely to result in 1,360 redundancies in management positions but it is a downgrade from the 2,600 job losses forecast during proposals in May.

Andy Clarke, Asda chief executive, explained that the decision was "one of the most difficult" he has ever had to make. The move will affect 4,100 managers across the UK but the supermarket maintained that following a 45-day consultation with staff, it would be creating 5,670 roles throughout its operations. However, the majority of these are likely to be on the lower pay grade and entry level positions.

"As much as it is my job, and privilege, to be chief executive officer of this business and to do what is right for Asda as a whole, this is one of the most difficult decisions I've had to make," Mr Clarke added.

"Whilst I genuinely believe that it is the right decision for the future of Asda, knowing that it will result in valued colleagues leaving us is not easy."

Asda currently employs over 170,000 people across 578 stores in the UK. It stated that it expects 1,360 members of staff to take the redundancy package. This will be offered to those that choose to leave or do not meet the overall selection criteria for the new roles.

The Leeds-based company became a subsidiary of US retailer Walmart in 1999 and is currently the third largest supermarket chain in the UK.

Walmart's share price closed at 75.75 at 18:04 BST on Thursday (July 3rd) representing a 0.17 per cent increase.

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