Makro Cash & Carry has set out ambitious plans to make cost savings of £12m this year, The Grocer has learnt.
The loss-making wholesaler made cost savings of £6m in 2009 and is understood to have told staff that it plans to double this in 2010 by scrutinising prices with suppliers, renegotiating contracts and clamping down on expenses.
MD Hannes Floto told staff that although it was a "big mountain to climb", cost savings had been on target last year and remained on target for the first part of 2010. There were also "ambitious plans" for the internet.
Earlier this month, The Grocer revealed Makro had started a 90-day consultation with 500 staff at departmental manager and supervisor level as part of a restructure of its depots. Sources close to the wholesaler claim 150 redundancies are expected, with 10 of Makro's 30 depots particularly affected.
One source said that for Makro to double last year's cost savings, which involved the closure of three depots, more would have to close.
"I suspect Makro will close a few branches over the next year," he said. "Hannes has been there for three years and his recovery plan was supposed to bear fruit after two years, so he will be under big pressure."
Makro's German parent company Metro Group is also understood to have told the company it must be financially independent by 2011. Makro UK's latest available accounts, for the year to 31 December 2008, showed Makro owed Metro Group £74.4m.
Floto refused to comment on financials, but told The Grocer: "We are a business in turnaround. Like any other business in this economic climate, we are continually looking at ways to make significant cost improvements so we can pass on even better prices to our customers.
"We have exciting plans for this year and beyond, following the creation of our board-led customer management team. One of the many long-term initiatives we are looking at is a greater presence on the internet."
The loss-making wholesaler made cost savings of £6m in 2009 and is understood to have told staff that it plans to double this in 2010 by scrutinising prices with suppliers, renegotiating contracts and clamping down on expenses.
MD Hannes Floto told staff that although it was a "big mountain to climb", cost savings had been on target last year and remained on target for the first part of 2010. There were also "ambitious plans" for the internet.
Earlier this month, The Grocer revealed Makro had started a 90-day consultation with 500 staff at departmental manager and supervisor level as part of a restructure of its depots. Sources close to the wholesaler claim 150 redundancies are expected, with 10 of Makro's 30 depots particularly affected.
One source said that for Makro to double last year's cost savings, which involved the closure of three depots, more would have to close.
"I suspect Makro will close a few branches over the next year," he said. "Hannes has been there for three years and his recovery plan was supposed to bear fruit after two years, so he will be under big pressure."
Makro's German parent company Metro Group is also understood to have told the company it must be financially independent by 2011. Makro UK's latest available accounts, for the year to 31 December 2008, showed Makro owed Metro Group £74.4m.
Floto refused to comment on financials, but told The Grocer: "We are a business in turnaround. Like any other business in this economic climate, we are continually looking at ways to make significant cost improvements so we can pass on even better prices to our customers.
"We have exciting plans for this year and beyond, following the creation of our board-led customer management team. One of the many long-term initiatives we are looking at is a greater presence on the internet."
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