Sainsbury’s is closing its in-store cafés and remaining patisserie counters as part of its ongoing programme to deliver £1bn of operating cost savings.
The retailer said it had made the “difficult decision” to cease operations at its remaining 61 Sainsbury’s Cafés nationwide over the coming months, subject to consultation. It added that the majority of its most loyal shoppers were not using the cafés regularly particularly as cafés and food halls run in collaboration with specialist partners such as Costa and Starbucks were growing in popularity.
Sainsbury’s also unveiled plans to create space to offer more of its fresh food ranges in more stores however this would require closing its remaining patisserie, pizza, and hot food counters – the most popular items from these would be made available in the aisles.
The latest proposals are expected to reduce headcount by over 3,000 roles across the business. It is also looking to reduce senior management roles by an estimated 20% along with other updates to its central management structures, aimed at helping support faster decision making and drive performance.
It comes at a time when Sainsbury’s revealed that more customers are choosing it for their big shop, with the business seeing strong momentum including seven consecutive quarters of volume growth, its best-ever value position, increased market share, and record customer satisfaction scores at Christmas.
Bakery update
The move comes less than a year after the retailer revealed it was planning to remove scratch baking from more of its in-store bakeries as part of wider proposals to help it deliver its three-year Next Level strategy.
However, Sainsbury’s is set to complete a rollout of updated bakery recipes by this summer, which it said will ensure consistent quality and value. New self-serve bread slicing will also be made available.
“We launched our Next Level Strategy almost a year ago and are totally focused on making good food joyful, accessible and affordable for everyone, every day,” commented Sainsbury’s CEO Simon Roberts. “As we accelerate into year two and beyond of our strategy, we are facing into a particularly challenging cost environment which means we have had to make tough choices about where we can afford to invest and where we need to do things differently to make our business more efficient and effective.”
Roberts added that Sainsbury’s will be “doing everything we can to support anyone impacted” by the announcement.
The retailer currently employs 148,000 people with almost 600 supermarkets and 800 convenience stores across the UK and Ireland.
Union reaction
The loss of 3,000 jobs was met with swift condemnation from Unite the Union, which said that the lowest paid workers were once again paying the price for corporate greed.
“Sainsbury’s is a hugely profitable company and made over half a billion pounds in profit last year,” asserted Paul Travers, national officer for food at Unite. “Yet they are proposing thousands of redundancies of store workers and deskilling qualified bakers by removing on-site bakeries. At the same time, well-paid managers are being protected from any job losses.
“This is a blatant example of profiteering on the backs of workers and then sticking the knife in. Sainsburys should be ashamed of themselves for taking this path,” added Travers. He noted that Unite will be fighting for its members’ jobs during any consultation process and “helping them through this difficult time”.
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