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Sainsbury 8217 s to cut 500 support centre jobs

Article By: ,  Financial Analyst
January 14, 2015 10:26 AM

Sainsbury's has started its cost-cutting measures by announcing that 500 jobs will be lost at its store support centres.

The highlighted jobs represent around 13 per cent of the supermarket's workforce and it could affect more staff than originally. Sainsbury's is expected to abolish some job roles which will see workers moved to other positions. Officials will now begin a 12-week consultation period to determine which jobs are to be cut.

Sainsbury's decision comes just a matter of days after it announced disappointing Christmas sales. During the traditionally busy festive period, the supermarket saw sales at stores open at least a year fall by 1.7 per cent, excluding fuel, in the 14 weeks to January 3rd. This added towards a 0.4 per cent drop in total sales.

This poor performance was offset by an announcement by the company stating that the week before was a "record", with 29.5 million customer transactions taking place. Despite this slightly more positive outlook, Sainsbury's still warned that there were "challenging" times ahead as it moved into the new year.

Redundancies look to be the first part of Sainsbury's restructuring plan. In a letter to staff chief executive Mike Coupe said: "We want to work through this period of uncertainty as quickly as possible, while making sure we consult with colleagues who are affected by these changes.

"We're committed to treating all impacted colleagues with respect, during what we know will be a difficult time."

Sainsbury's just one of the traditional supermarket which reported sales drops over the Christmas period. Both Morrisons and Tesco also experienced disappointing festive trading leading to both announcing plan to close stores. Morrisons stated that it would be shutting ten loss-making shops while Tesco will close 43 stores and has cancelled the creation of 49 new outlets.

It comes as supermarkets face increasing competition from discounters such as Aldi and Lidl.

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