UK supermarket retailer Sainsbury’s has appointed a new clothing commercial director amid an 18.3% dive in year-on-year clothing sales and plans to axe about 3,500 jobs.
The retailer, which announced its half-year results today (5 November), said sales in its clothing division fell to GBP0.4bn (US$0.52bn) from GBP0.5bn a year earlier.
Poor performance of its clothing brand Tu weighed on its overall sales performance, which was 1.4% lower year-on-year to GBP16.3bn.
Sainsbury’s said the sales decline in its clothing division was driven by a deprioritisation of non-essential spending during the pandemic.
Conversely, online clothing sales grew by 75% as customers switched to shopping digitally.
Going forward the supermarket retailer says its non-food businesses and brands “must deliver in their own right and actively support our ambition in food”.
As a result of this, it plans to open up to 150 more Argos stores in Sainsbury’s and add further collection points in supermarkets and convenience stores. The aim is for every Sainsbury’s supermarket to have either an Argos store or collection point. It will, however, close around 420 standalone Argos stores in the UK.
The move impacts 3,500 jobs. Simon Roberts, CEO of J Sainsbury Plc, said the group was talking to colleagues affected about the changes and how it could impact their roles.
The group has also announced a new supply chain and logistics operating model in a bid to lower costs, moving to a single integrated supply chain and logistics network across Sainsbury’s and Argos. As a result of this, a number of existing depots are closing.
Separately, the group announced the departure of commercial director Paul Mills-Hicks.
Mills-Hicks is leaving after 17 years as part of changes Roberts is making to his leadership team.
“Our new plan puts food first. This means delivering improved and consistent value, more product innovation and great service for our customers. Our other brands – Argos, Habitat, Tu and Sainsbury’s Bank – must deliver for our customers and contribute positively in their own right and actively support our ambition in food,” said Roberts.
Roberts has created two commercial leadership roles, a food commercial director and a general merchandise and clothing commercial director.
Rhian Bartlett, currently director of fresh food, will take on the role of food commercial director and Mike Luck, director of business development, will become general merchandise and clothing commercial director.