Makro: 18 months to turn around business

New directors at Makro Cash & Carry UK have 18 months to turn the business around, staff at the loss-making wholesaler have been warned.

Directors from Alix-Partners have told parent company Metro Group that they expect to post a profit by 2013, and Metro has ­accepted the timeframe, The Grocer has learnt.

Makro has also warned its 5,000 staff that job cuts are on the way, although no decision about which roles will go, or when, has yet been taken.

"They're going to look at reducing the headcount but they don't want to rush into it and make mistakes," an insider said.

Metro Group replaced all but one of its directors with four consultants from AlixPartners last month. They were parachuted in after MD Hannes Floto and three other directors suddenly departed "due to ­differing views on the ­strategic direction of the company".

Makro has racked up losses of more than £100m in the past four years, including a £44.7m loss in the year to 31 December 2009, the most recent accounts available.

One of the first moves by the new board has been to remove the barriers from the customer entrance of its depots. Customers will still need a store card to make a purchase, but Makro is also planning a fast-track process to make it easier for businesses to join. It also plans to test new models for its non-food and food offerings at 'role-model' depots in Teeside and Manchester.

"We're currently finalising a turnaround plan to get Makro back on track as quickly as possible," a Makro spokeswoman said. "This plan does not include any store closures, but it does include measures designed to make it easier for the customer to purchase from us. Where opportunities present themselves we will move quickly to improve the customer experience. To help us achieve this we are aligning ourselves more closely with Metro Cash & Carry and we are actively seeking and ­receiving ­support from all areas of the business."