Metcash culls staff and warehouses to cut costs

Metcash to close almost half of the warehouses of its Cash and Carry division due to declining profits

March 26, 2010

Marketing and distribution company Metcash will close almost half of its Cash and Carry division's warehouses and sack staff due to declining profits.

Eight of the 20 warehouses will be closed, while the division will be merged with the Metcash-owned Campbells Wholesale.

Campbells operates the CStore Distribution, Foodlink and Cash and Carry divisions.

In a statement, Metcash CEO Andrew Reitzer the Cash and Carry wholesale market suffered a loss in customers this financial year and is no longer viable.

"Although this is a painful action to have to take, especially having regard for the excellent staff we will be losing, it is a necessary action to ensure the ongoing health and vitality of the overall Campbells Wholesale business," Reitzer says.

The change will cost $10.8 million, but Metcash expects it will lead to increased profits of $4 million to $5 million each year.

Metcash also plans to relocate its NSW CStore Distribution warehouse from Liverpool in NSW to its Northmead Campbells Cash and Carry warehouse.

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