Warehouse Group expects to shed about 130 jobs in an effort to save up to $20 million in the FY18 year
The country’s biggest listed retailer has been consulting with staff at its support office in Auckland over the past few weeks as part of an overhauled business structure that will combine its leadership structure of its stationery and ‘red sheds’ into one.
The Warehouse Group will also be combining its leadership structure for its owned Noel Leeming and Torpedo7.
Chief executive Nick Grayston said the company expects about a net 130 roles to go, and anticipates annual savings of $15 million to $20 million, with a one-off restructuring bill of between $10 million and $13 million.
Nick Grayston also said that the exact number of job cuts was not yet set in stone because staff were still being redeployed where possible.
Once that process was finished, he could confirm the number of people who were leaving the business.
"At this stage, we are anticipating a net reduction of around 130 roles and we will be doing everything we can to support our team members during this time."
"Discussions with team members are ongoing with a view to supporting those who are impacted through a redeployment process," Grayston said. "We will be doing everything we can to support our team members during this time."
Warehouse signaled it wanted to strip out "significant cost" by cutting duplication across the groups when announcing the new structure last month.
The Warehouse employs more than 12,000 people, according to its website. Its wage bill rose to $456.7 million in the year ended July 31, 2016, from $439 million a year earlier, while its performance based compensation jumped up to $23.1 million from $8 million in 2015.
Maxine Gay, an organiser for First Union, said her union represented staff in the group's stores and distribution centres rather than those at head office level.
But she was relieved that the number of job cuts was not higher.
"It's obviously quite sad for those people, but it could have been more. We remain hopeful that this is where it ends."
Grayston said the savings from the restructure won't show up until the 2018 financial year with savings in salaries and reductions in other areas including external provider and operational costs, and other overheads.
The Warehouse, the Warehouse Stationary, Noel Leeming and Torpedo7 have a total of 248 retail stores combined.
The shares rose 1.9 percent to $2.68, and have gained three percent over the past 12 months.
The group said it would make a further update during its first half results on March of this year