Sainsbury’s to close two Argos distribution sites risking 1,400 jobs

Sainsbury’s is planning to shut two Argos distribution centres, placing as much as 1,400 jobs in danger, and can ditch {the catalogue} store’s Milton Keynes head workplace and three remaining Habitat showrooms to chop prices.

The retailer stated it anticipated to shut the warehouses in Basildon, Essex and Heywood, Larger Manchester, by 2026 leaving three non-food warehouses that can serve each Sainsbury’s and Argos.

The adjustments are a part of a £90m rejig of the Sainsbury’s group’s distribution community, which will even contain funding in extra automation at a warehouse in Daventry, in Northamptonshire.

Sainsbury’s stated the adjustments would create a “easier, extra trendy community to considerably enhance availability, cut back inventory and allow quicker buyer deliveries”.

The retailer’s cuts come as conventional supermarkets hunt for methods to trim prices to put money into preserving costs aggressive amid hovering meals value inflation, greater power payments and labour prices.

On Tuesday, Marks & Spencer stated it was spending £60m on elevating minimal pay for retailer employees by virtually 7% to £10.90 an hour, properly above the authorized minimal. Sainsbury’s and another grocers now pay a minimal of £11 an hour.

Sainsbury’s has pledged to ship £1.3bn of price financial savings within the three years to September 2024 – resembling closing cafes, contemporary meals counters and excessive avenue Argos shops – because it spends £550m on preserving down costs by March this yr. It purchased Argos in 2016.

The most recent market share figures out this week confirmed each German-owned discounters Lidl and Aldi rising by greater than 25%, whereas Sainsbury’s gross sales rose by 6.2% within the three months to 19 February – on a par with its shut rivals Tesco and Asda.

No jobs are in danger from the closure of Argos’s Milton Keynes head workplace, the place Sainsbury’s stated simply 11% of desk area was usually used. Employees working there are anticipated to maneuver to one in every of Sainsbury’s different places of work.

Simon Roberts, the chief government of Sainsbury’s, stated: “As with every main change to our enterprise, we’ve got not taken the troublesome determination to begin this session evenly. As a part of our plan to create an easier enterprise, we beforehand set out our intention to combine our Argos and Sainsbury’s logistics networks.

“Over the previous few years, we’ve been working onerous to remodel this community as we make our enterprise easier, extra environment friendly and simpler for purchasers. This additionally permits us to scale back prices, so we will make investments the place it is going to take advantage of influence for our prospects.”

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