About 5,000 jobs are at risk at Asda, which is shutting two warehouses and eliminating thousands ofback-office jobs as part of an online grocery push.
The Leeds-based company confirmed a formal consultation with staff had begun as it sought to close two so-called dark stores in Dartford, Kent, and Heston, west London, and switch to picking grocery orders from the shelves of local stores. The decision affects 800 staff.
Asda is also making big changes to how stores are managed. It is proposing that cash office, administration and HR tasks be completed by “one multi-skilled back-office colleague”. This shake-up affects 3,000 workers, with the company citing the reduction of cash handling as shoppers switch to cards.
The chief executive, Roger Burnley, said the pandemic had resulted in a big shift towards online grocery shopping and the business had to adapt quickly.
“As customer habits continue to change we have to evolve our business to meet these demands and ensure our business is strong and sustainable for the long term,” he said.
Asda is also scrapping the deputy store managers and section leader roles and replacing them with operations manager and online trading manager roles, which are still salaried positions. The move affects 1,100 employees but the changes would increase the number of store-level management roles, it said.
It also emerged that Boots has embarked on the second round of job cuts in less than a year at its head office in Beeston, Nottinghamshire. The restructuring will eliminate 300 roles, about a tenth of the site’s workforce.
Boots, which is part of the global Walgreen Boots Alliance chain, eliminated 4,000 jobs last year through a combination of store closures and head office cuts. No store or pharmacist roles are affected by the new cuts, but Usdaw’s national officer, Daniel Adams, described them as devastating for those affected.
The Asda shake-up is not linked to the £6.8bn sale ofthe supermarket chain to the petrol forecourt billionaires Mohsin and Zuber Issa and TDR Capital, which was finalised last week. That is because the deal is yet to be cleared by the Competition and Markets Authority.
Although 5,000 workers are affected by the consultation, the company expects a “large number of colleagues will remain with us in either their current role or one of the newly created roles”.
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The priority would be to move as many workers as possible into alternative roles, with redundancy the last option, Asda said. The expansion of its web operations would create 4,500 jobs, it added.
The company, which has a total workforce of 145,000, has increased its online capacity by 90% since March to 850,000 weekly slots. It expects to be fulfilling 1m orders a week by the end of the year.
Burnley said the business was adapting to the changing demands of the retail sector as shoppers switched to online services during the pandemic. Within a year, delivery volumes had reached a target the company had expected to take nine years to achieve.
“We know these proposed changes will be unsettling for colleagues and our priority is to support them during this consultation process,” he said. “Our plans to transform the business will result in more roles being created than those we propose to remove.”
Boots also blamed it head office cuts on a dramatically altered retail landscape. Its managing director, Seb James, said the pandemic had changed consumer behaviours forever.
As an essential retailer, Boots stores have stayed open during the lockdowns, but trade has been disrupted. Sales at established stores were down 9% at the last count. Stores on major high streets and in transport hubs have been hit by the decline in shopper numbers, while online orders have risen strongly.
“This means investing in our digital business, serving customers more efficiently and, above all, becoming much swifter and more agile,” said James. “We will do everything we can to make sure that we support and help anybody who is affected.”