Discount supermarket operator Aldi is cutting hundreds of head office and logistics roles across its UK operations as part of a broader global cost-trimming initiative.
- UK sales rose just 0.4% in the 12 weeks to November 1, with market share slipping 0.1 percentage points year on year.
- The company is consulting on up to 150 technology job cuts following 103 redundancies in finance and administration earlier this year.
- Operations are shifting toward automation and outsourcing, aligning with moves made by major competitors like Morrisons, Sainsbury’s (LSE: SBRY), Tesco (LSE: TSCO), and Asda.
The German-owned discount grocer is reducing headcounts in local country operations while centralising administrative and technological functions.
The company has cut almost 20 buying director positions and slightly reduced its number of regional managers.
One affected worker described the cuts as “shortsighted” and said they showed that “upper management [are] woefully out of touch with the reality,” the worker told The Guardian.
Store-level employment remains unaffected by the current restructure, although cleaning hours for agency workers at the Atherstone, Warwickshire head office have been scaled back. Payroll redundancies are expected to face consultation phases in the coming months.
The restructuring involves shifting finance, procurement, and administration duties overseas. Aldi is outsourcing finance, procurement and administration roles to India and other countries through an agreement with Genpact, a company that helps businesses develop the use of AI technology.
A spokesperson for Aldi addressed the operational changes in a statement:
“At Aldi, our promise to customers is that we will always offer great quality products at unbeatable prices. Across our international business, we continuously review all aspects of our operations to ensure we operate simply, efficiently and use our global scale to deliver on that promise.”
The company added that it had invested £300m in lowering prices on 900 products throughout the UK this year. The spokesperson said that the company recognises the difficulty of these transitions and provides full support to affected colleagues.
According to industry data from Worldpanel by Numerator, UK sales at the chain grew only 0.4% in the 12 weeks to November 1.
During the same 12-week period, the chain’s market share contracted by 0.1 percentage points year on year. The average unit price at Aldi fell 0.1%, positioning the discounter as the sole major retailer lowering overall prices during the timeframe.
Traditional supermarkets have increased competitive pressure by matching discount pricing on essential items while retaining broader product ranges. Across the industry, competitors have pursued similar labour reductions and automation strategies over the past year.
Morrisons cut hundreds of head office positions in the spring, shortly after Sainsbury’s eliminated 300 head office jobs while restructuring its technology team and Argos delivery network. Tesco similarly laid off hundreds of workers while altering in-store bakery operations, while Asda placed up to 1,000 logistics jobs at risk by introducing increased automation.
Disclaimer: The information provided in this article is for educational and informational purposes only and does not constitute financial advice.
