Tesco share price: Retailer to axe 1,000 jobs in UK operations shake-up

on Jan 10, 2017
Updated: Oct 21, 2019
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Tesco (LON:TSCO) has unveiled plans to slash 1,000 jobs as part of a shake-up of its UK operations which will see Britain’s biggest supermarket overhaul its distribution network. The news comes ahead of the group’s trading update later this week.

Tesco’s share price has jumped in early morning trade, following upbeat results at rival Wm Morrison Supermarkets (LON:MRW). As of 08:05 GMT, the shares were changing hands 3.61 percent higher at 208.20p, outperforming the blue-chip FTSE 100 index which has climbed marginally higher and is currently 0.30 percent better off at 7,259.60 points. The group’s shares have gained more than 42 percent over the past year, as compared with an over 22-percent rise in the Footsie.

Tesco announced in a statement yesterday that it was proposing changes to its distribution network which will reduce the number of the group’s distribution centres from 25 to 23, and will include closing arehouses in Welham Green, Hertfordshire, and Chesterfield, Derbyshire, as well as overhauling the management of its distribution network.
The Guardian noted in its coverage of the news that the move will lead to 1,015 jobs being cut, including 444 at Welham Green, 207 at Chesterfield and 364 in the warehouse management team. The retailer, however, intends to create 533 jobs elsewhere in its network, while some of the affected staff could find different roles within the company.

“As the needs of our customers change, it’s vital we transform our business for the future,” Matt Davies, Tesco’s UK chief executive, commented in the statement. “As part of this we are proposing to close two of our distribution centres in the UK. These changes will help to simplify our distribution operations so we can continue to serve our customers better.”
The move comes ahead of the grocer’s results on Thursday when the company is expected to post a rise in like-for-like sales over the crucial Christmas period.
As of 08:49 GMT, Tuesday, 10 January, Tesco PLC share price is 208.65p.

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