Woolworths to axe 400 jobs as supermarket looks to ‘neutralise’ rivals in on-going price war


Woolworths logoWoolworth has flagged there will be no let up in its marketing price war with rivals after vowing to “neutralise Coles and contain Aldi” in the on-going battle for supermarket supremacy.

The retailer made the pledge after reporting a three per cent lift in third quarter sales, excluding petrol. Woolworths also confirmed an additional 400 non-customer facing jobs will be axed by the first half of the 2016 financial year.

It is unclear if any marketing roles will be cut.

Including petrol, group-wide sales for the three months to April 5 fell 1.6 per cent. Its key food and liquor operation saw a 2.3 per cent sales rise, falling to just 0.7 per cent on a comparable store like-for-like basis.

Woolworths made clear it has no plans to abandon its price message and outlined a three-year plan to invest more than $500m in “delivering lower prices, better service and more attractive offers”. An “improved loyalty system” will also be launched.

The company will fund the investment through cost savings in other areas of the business, including the 400 job losses, and flagged a “new pricing and value strategy”.

“[It will] be implemented to neutralise Coles and contain Aldi’s impact on our sales, with measures including lower pricing, better ranging, targeted customer offerings using a revised and improved loyalty system and a detailed strategy for improving Own Brands,” the firm said.

Despite the focus on price, Woolworths Food Group managing director Brad Banducci claimed the “true battleground” was the “overall customer experience”.

“So we will not be beaten on price and we will provide better convenience, superior freshness and a more appealing range and a focus on innovation,” he said.

Elsewhere in the group, Masters sales for the quarter climbed 21.2 per cent with Big W falling 2.1 per cent.


Get the latest media and marketing industry news (and views) direct to your inbox.

Sign up to the free Mumbrella newsletter now.



Sign up to our free daily update to get the latest in media and marketing.