Sainsbury’s has said it will cut around 3,500 jobs as part of plans to permanently close all its meat, fish and deli counters, as well as some of its Argos stores.
It came as the UK’s second largest supermarket firm posted a pre-tax loss of £137 million for the past year, after being hit by £438 million in one-off costs related to store closures.
The grocer said the closure of the specialist counters is part of efforts to “better reflect customer demand” and will save the business around £60 million.
It also said roles will go with the imminent closure of 120 Argos stores, which is part of a strategy to shut 420 standalone Argos branches over the next three-and-a-half years.
The long-term plan will leave it with around 100 standalone stores as it accelerates the launch of more Argos stores and collection points in Sainsbury’s locations.
Sainsbury’s has said growth across the business will result in the creation of thousands of new jobs, with the company expected to see a net increase of 6,000 permanent roles this year despite the latest cuts.
Chief executive Simon Roberts said: “We are talking to colleagues today about where the changes we are announcing in Argos standalone stores and food counters impact their roles.
“We will work really hard to find alternative roles for as many of these colleagues as possible and expect to be able to offer alternative roles for the majority of impacted colleagues.
“Right here and now, I and all the team are focused on supporting and delivering for our customers in the days and weeks ahead.”
The job losses come as more than 2,500 jobs are set to go after the John Lewis Partnership and Lloyds Banking Group both announced major cuts on Wednesday.
Sainsbury’s has said it will pay out a special dividend of 7.3p to shareholders after strong sales in the face of Covid-19, despite announcing the redundancies.
The group said it is also now on track to expected to post underlying pre-tax profits for the current full year that are 5% higher than last year after “stronger-than-expected sales, particularly at Argos”.
Sainsbury’s revealed that total like-for-like sales increased by 6.9% for the 28 weeks to September 19, as it was buoyed by 8.2% grocery growth.
It also posted a 117% jump in digital sales to £5.8 billion as it was boosted by surging demand for grocery deliveries.
Shopworkers’ trade union Usdaw is to enter into consultation meetings with Sainsbury’s/Argos management over their proposed restructuring.
Dave Gill, Usdaw national officer, said: “Sainsbury’s/Argos has briefed us on their plans to restructure the business, which includes the proposed permanent closure of a number of Argos stores and counter services in Sainsbury’s supermarkets that were closed in March, at the beginning of the first lockdown.
“We will now enter into meaningful consultation to examine the proposals.
“Usdaw is confident of securing redeployment within the business for vast majority of staff affected.
“Our priority is to safeguard their jobs and achieve the best deal possible for staff.
“In the meantime we are providing Usdaw members with the support and advice they need.”