South African retailer Pick n Pay has revealed plans to make more than 3,000 staff redundant.
The company has set out plans to make 3,137 staff redundant amid a drop in profits.
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Pick n Pay operations director Neal Quirk said the decision had been made after “great deal of thought over a period of time”.
However, Quinn explained the move “was in line with the major problem facing the company in respect of declining profitability and the loss of market share”.
He insisted that the decision was not taken lightly but was required to ensure the “viability of the retail business and its employees into the future”.
“We’ve worked hard at looking at possible alternatives that may reduce the number of full-time people affected and these options will be discussed during our consultation process with the union,” he added.
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By GlobalDataThe Congress of South African Trade Unions condemned the move. “We cannot afford to lose still more jobs at a time when unemployment is still a national crisis,” the organisation said.
The group attributed the job losses at Pick n Pay to the threat posed by the recent deal between rival retailer Massmart and Wal-Mart Stores. The US retail giant has acquired a majority stake in Massmart.
“We predicted that this would lead to retrenchments in other retail companies, as they struggle to compete with this global giant in the retail sector, and Pick n Pay is proving us to have been right,” said national spokesperson Patrick Craven.
However, Quirk told just-food that the moves were unrelated to Wal-Mart’s entry into the country.
“This process is unrelated to Wal-Mart’s entry into South Africa but is rather about addressing our ability to compete effectively. Failure to do so will result in contraction of the business and result in a non-sustainable business for the future,” he said.
In April, the retailer booked what CEO Nick Badminton described as the “toughest trading year in the group’s history” as it booked an 18% drop in annual profits.
