Primark cuts hundreds of jobs as store management reorganizes | Business News – Archyworldys

Primark has revealed plans to cut hundreds of jobs as part of a store management overhaul – as it has pledged not to hike prices.

The fashion retailer “proposes to eliminate a number of roles as well as create a new entry-level leadership role,” a spokesman said.

Overall, the company expects to cut 400 jobs across its network of 191 stores in the UK, which currently employ 29,000 people.

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UK inflation hits 30-year high

Details of the proposals, described as “part of our ongoing program to improve the efficiency of our retail stores”, were revealed in a trade update from owner Associated British Foods (ABF).

It pointed to a decline in sales from Omicron at Primark, followed by an improvement in recent weeks.

Like the rest of the economy, it faces growth Inflation Pressure – but insisted it had no plans to raise prices.

Overall, the fashion retailer’s UK sales in the 16 weeks to January 8 were up on last year but still 10% down year-on-year.pandemic levels.

Delivery delays expected

The company said it was facing pressure on its raw material and supply chain costs, but said this has been mitigated by favorable exchange rates and a reduction in stores’ operating and overhead costs.

ABF said the pressure on the supply chain experienced in the autumn has eased, although there are still some delays in the ports from which goods are being shipped, adding: “We expect longer shipping times to continue for some time to come.”

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Primark sales remained 10% below pre-pandemic levels

Kari Rodgers, Primark Retail Director for the UK, said: “The changes we are proposing will result in a simplified and more consistent management structure across our stores, with more opportunities for career advancement and greater flexibility.

“We are now focused on supporting our colleagues impacted by these proposed changes and will go through the consultation process.”

UK website launch in March

Meanwhile, Primark – which unlike rivals doesn’t have an online retail platform – was on track to launch a new customer-facing site in the UK by the end of March, the company said.

It said the site will “feature a lot more of our products and provide customers with product availability by store.”

The update – and Primark’s confirmation that it’s not planning a price hike – is coming, the latest figures show rising inflation in the broader apparel sector amid a rise in the cost of living.

Rival Next said so anticipates price increases by up to 6%.

ABF signaled prices could rise in other parts of its business — a sprawling conglomerate that also includes a big sugar operation and brands like Ryvita, Twinings and Ovaltine.

Laura Hoy, equity analyst at Hargreaves Lansdown, said: “Inflationary headwinds are an inevitable storm cloud hanging over almost everyone right now, but we believe ABF is well positioned to weather it.

“But if costs continue to escalate, that could become a problem for Primark, as its position as a discounter leaves it with very little room to increase costs.”

Reference-www.nach-welt.com

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