There was fresh speculation this week that Sainsbury was considering axing 600 HQ jobs and relocating to Milton Keynes in a bid to cut costs.
Suppliers said they were unable to get a straight answer out of Sainsbury regarding its plans but believed substantial job cuts were on the cards.
With second-quarter trading figures expected to be dismal, CEO Justin King will be under pressure to take action when he gives the City an update on October 19, said analysts.
However, the cost and disruption of exiting its Holborn HQ could outweigh the benefits, said one. “They have still got more than 20 years to go on a lease struck at the height of the property boom.
“If the landlord can’t find a suitable tenant, they may have to sub-let or buy their way out at great cost.”
However, King was almost certain to cut more jobs, despite the recent purge at head office, which had removed several hundred personnel, he added. “They will have to have more of a Morrisons-style culture with fewer people going further.”
A spokeswoman for Sainsbury said “nothing has been ruled in and nothing ruled out” as King conducted an operational review.