Tesco’s Irish operations — which employ more than 13,000 people — will not be affected by the British supermarket giant’s latest cost-cutting round.
Britain’s biggest retailer has proposed closing its customer service centre in Cardiff with the loss of up to 1,100 jobs, as part of a broader drive to cut costs and improve margins.
The company said it was consolidating its two UK customer engagement centres into a single expanded operation in Dundee, where 250 new positions would be created.
Tesco set out a plan last October to reduce operating costs by £1.5bn (€1.7bn) over three years.
It needs the savings to help achieve its target of a group operating margin of 3.5% to 4% by the 2019 to 2020 financial year, up from 2.3% in 2016 to 2017.
“The retail sector is facing unprecedented challenges and we must ensure we run our business in a sustainable and cost-effective way while meeting the changing needs of our customers,” said Matt Davies, chief executive of Tesco’s operations in the UK.
“We realise this will have a significant effect on colleagues in the Cardiff area,” he said.
Tesco’s Irish customer care centre is based in Waterford and employs 22 people, who will not be affected by the UK move.
In February, Tesco detailed plans to replace 1,700 deputy managers at its “Express” convenience stores and in January it proposed a reorganisation of its distribution network with a net loss of 500 jobs.
Tesco is Britain’s biggest private sector employer with a staff of more than 310,000.
Tesco recently regained the number two slot in the Irish grocery market and saw 0.2% like-for-like sales growth in Ireland in the three months to the end of May; the first quarter of the group’s financial year. Its Irish sales volumes grew by 4.6% in the quarter.
additional reporting Reuters
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