Massmart commences talks with unions to cut 1,800 jobs

8 July 2020 (Last Updated July 16th, 2020 14:12)

South Africa-based retail chain Massmart Holdings has begun talks with employee unions to axe up to 1,800 jobs at its struggling Game stores as Covid-19 affects its sales.

Massmart commences talks with unions to cut 1,800 jobs
Massmart owns various local brands including Game, Makro, Builder’s Warehouse and CBW. Credit: Discott.

South Africa-based retail chain Massmart Holdings has begun talks with employee unions to axe up to 1,800 jobs at its struggling Game stores as Covid-19 affects its sales.

Massmart, which is majority-owned by Walmart and operates supermarkets and wholesale chains such as Makro and Game, commenced the discussions with the unions after reviewing the efficiency of the outlets.

According to the retailer, it was implementing a new operating model at Game following its “indifferent performance in the 2019 financial year” and the negative impact of sales due to novel coronavirus.

The firm, however, stated that it would not shut down any outlets.

Earlier this year, Massmart stated it would reduce costs and restructure into wholesale and retail units. However, coronavirus has made the company to accelerate its turnaround strategies.

During the nine-week lockdown period due to Covid-19, the group lost ZAR4.6bn ($268m) in sales.

The potential job cuts represent around 3% of the total employee count at Massmart.

Massmart has become some of the firms in the country that have announced job cuts. Steel producer ArcelorMittal South Africa Ltd, food manufacturer Tiger Brands and telecom operator Cell C have already announced plans to cut jobs, reported Reuters.