The Co-operative Group is to slash 600 jobs from its head office in a £50m cost-cutting and efficiency drive to counter falling sales.
The move, which was announced on Thursday as The Grocer went to press, will mean just under one-fifth of its 3,300 head office staff will go in the next two years.
Redundancies will be from all levels of management and across all functions, from finance to marketing.
Group chief executive Martin Beaumont said that the cuts were deeply regrettable but he claimed the society’s structure was unsustainable.
“This is not just about cutting costs. The group has evolved into a conglomerate of individual businesses, often with their own significant support structures and overheads.
“At head office this autonomy has sometimes resulted in the duplication of management effort, leading to inefficiency, higher costs and missed opportunities. While we have made some progress, our recent results clearly show we now need to move much faster.”
The society reported profits of £244m in 2004, down from £327m the year before.
This was on sales of £7.8bn, down from £8.1bn in 2003.
Beaumont added that the restructuring process, while painful in the short to medium term, would put in place a new streamlined management structure that would enable the Co-operative Group to “take maximum advantage of our strengths as a family of businesses”.
The job losses follow the completion of a review of head office functions and costs as part of the Co-operative Group’s programme to turn around business performance.
The company is meeting with shopworkers’ union Usdaw and the National Association of Co-operative Officials early next week as it begins a 90-day consultation process.

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