Debenhams (LON:DEB) is planning to cut 320 store management jobs as they look to restructure the company in order to reduce costs and optimise operations.
The changes in the organisational structure comes after a profit warning announcement following a disappointing Christmas trading period. The group’s like-for-like sales were down 1.3 percent.
The UK has become a highly competitive market for retail, which is shifting into the online shopping market and it is more promotion-driven. This has resulted in a weaker demand for Debenhams’ products.
“The market has been challenging and particularly promotional in some of our key seasonal categories and we have responded in order to remain competitive for our customers, which has impacted our profit performance. Nevertheless, we are seeing positive early signs from the changes we have made as part of our Debenhams Redesigned strategy,” said Sergio Bucher, chief executive of Debenhams.
The 320 jobs represent about a quarter of all the company’s management positions. If the cuts take place, Debenhams said they will redeploy the staff affected.
An official announcement will be released in March. In the meantime, a company spokesman said:”We are currently consulting with individuals affected and will seek redeployment opportunities where possible.”
Debenham’s cut is not new for the sector. Other companies such as Sainsbury’s, Tesco and Morrisons have already announced they also have plans to cut jobs and strip out middle management roles.
Debenham’s shares were down 0.75 percent, trading at 29p, as of 15:20 (GMT).