The Warehouse proposes laying off 180 staff

First Union's Dennis Magaaged says the company will replace the roles with lower-w staff.

Warehouse staff were told yesterday about a proposal to make about 180 store managers, team leaders and supervisors across 99 stores redundant.

NBR understands it's part of a change to the company's leadership structure at store level, with new roles being created so some staff may be re-employed. 

A spokeswoman for the Warehouse says a proposal was shared with staff yesterday, which was developed with input from a working group of store managers. 

"It’s a proposal only and we are seeking feedback from our teams before deciding on next steps, so it’s not appropriate to comment further at this point," the spokeswoman says.

First Union's Dennis Maga says team leaders will be replaced by a sales or trade manager and supervisors will be replaced by the second in charge.

“It’s about removing those long-time employees. I think it will save them a lot of money in terms of long-term costs.

“We have to remember that [some of] these supervisors and team leaders have been at The Warehouse for 15-20 years." 

Mr Maga says four years ago, the Warehouse raised the wages of staff who have done the required training for their jobs and have at least 5000 hours experience.

The Warehouse Group has been struggling in a tough trading environment for some years, amid increasing competition from offshore and online retailers.

The retail group has started a three-year transformation programme to reduce operating complexity under chief executive Nick Grayston, who took over more than two years ago from Mark Powell – who also attempted to overhaul the business.

This transformation includes changing its pricing strategy from high-low stock clearances to everyday low pricing, which management thinks will simplify operations and won’t expose it to as much to international price-based competition as a discounting strategy would.


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23 Comments & Questions

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Changes being made so there will still be jobs
Unlike pumpkin patch etc
Skilled good people always get snapped up

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Maybe CEO Nick Grayston could set the scene and take the first pay cut.

That might give staff confidence that he backs his own strategy.

All other strategies hAve failed

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What is that flapping noise outside my window?

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Seems to be the common strategy, ramp up the social media feel good campaigns whilst delevering "proposals" on restructuring to staff.

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Any staff based in Auckland who have strong customer service skills can get in touch with me. I have roles that need filling by proactive, hard working people - i suspect our pay rates will match / exceed what a team leader is paid.

027 269 2463

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More job loss? Seriously???

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Thr should be a law against unjustified layoffs. If companies are laying people off, they should be making losses. Also ceo's should be taking paycuts and giving up on the bonuses before they start destroying people's lives. They are playing with hundreds of lives just to make more profits.

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What a ridiculous comment - why should a business that has invested hundreds of millions of dollars need to be losing money before it restructures its operations and people? There should definitely not be a law about allowing a company to structure its operations to remain or get competive.

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I suppose you think the CEOs who dump their low paid employees (who do the real work), their "greatest asset," onto the dole queue all to get their performance bonuses on top of their multi-million salaries are worth every penny too? Another sucker who's drunk deeply from the neo-liberal kool-aid propaganda fountain.

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Really you think!! You forgot the bit about how this is what's wrong with the world these days.
I've just put your name forward for the mastermind program. Special subject, the bloody obvious.

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So this ammounts to 1.5% of the 12000 staff employed, and averaging 2 people per store.
Hardly a radical restructuring. Seems like normal prudent business to me. Shopping trends are going more online, physical retail has to be very lean and responsive to consumer demands to survive.

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Possibly. Ask a female, and kids for that matter if they want to go to the malls and shop, the answer will always be hell yeah. Shopping, it's in their dna, and always will be.

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Agreed. Smart business practice and as a business owner sick of the hate when companies make efficiencies. Often there are much better roles these people can get (those who look at it as an opportunity). I pray for the day councils take the same approach and start to rein in their costs.

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A business can make whatever descicion they see fit, even, with the Warehouse it seems to me the decline is inevitable with online retail giants like Amazon entering the NZ market

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Kmart is killing them. Shopping at the warehouse is a depressing experience.

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Whatever the said strategy for restructure is it has made the warehouse a most unpleasant place to be in.
I hate the layout and the marketing system.
What floor assist they have is very low level and often non existent when needed.
They also don't care.
Fortunatly there are alternatives..

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a quick visit to the warehouse will confirm what is fundamentally wrong, i mean who on earth still buys cd's yet the warehouse has bins full of them....there is just too much crap

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They are unjustifiable layoffs if the staff are being removed because they've been there too long.... wtf! What a joke. They want you to come into work every day but don't want you there for years? That is business logic, not looking after your LOYAL staff logic. Unfortunately, humans are predictable and disposable and these businesses know that. They also knew it was coming 4 years ago hence the trained replacements! It also sounds like it's going to be the bigger Warehouses that will be affected if they are going to replace teamleaderS with A sales/market manager and supervisorS with A second in charge (NB: the plurals into singles). I hope the staff that are reemployed don't loose their benefits already accumulated. Big businesses know exactly how, what, when and where people shop. Don't give me that bull shit about their hardship. They indirectly ran our country for two terms before Labour came in.

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You can’t shrink your way to growth in retail.

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This is all about executives being incentivised to cut costs & looking after themselves.
Maybe the board should consider incentivising executives to increase profits through increased trading margins/lower buy prices.
Signing off on a strategy that gives executives carte Blanche to lose money now so they can make more money later is crazy logic - most companies sign off new strategies to make more money not less.
Oh well who cares about loyal employees anyway - it looks like they will go the same way loyal local suppliers did ........

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Simple comparison to Briscoe and Rod Drury tells it all. From the start of 2010 until today Briscoe up 187% and Warehouse down 50%. If someone care to do any analysis I would say this is strongly negatively correlated to Executive remuneration.

How many +$1M employees at Briscoes ?

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Maybe 1 if you can count Rod Duke as an employee as well as major shareholder.
The execs at The Warehouse maintain hi low retailers are a thing of the past - probably a bit like Sears in the US is - I guess someone forgot to tell Briscoes their tried & tested hi low strategy is a bust - everyday low price with no call to action is the way of the future apparently which is why The Warehouses strategy seems to be to copy everything Kmart does (only they do it really badly) I wish I knew why employees with proven performance in terms of actually growing sales & profit have been squeezed out by a team of execs who have no track record in growing sales and profit at all - maybe the board are deliberately sabotaging things so the share price goes so low Stephen Tindal can buy it back - at least that would be a strategy that kind of makes sense.......

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I understand The Warehouse has been finding it hard to trade against our oposition, Briscoes, KMart and Amazon.com. Therefore i propose that according to the Government process if Team Leaders or Supervisors have to take a lesser position doing another job, then their wages should stay as they are at the moment for a period of two years. Giving them time to adjust to their new roles.

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