UK retail giant Asda considers outsourcing customer service jobs
LEEDS, UNITED KINGDOM — Asda, the UK retail giant, is embarking on a new round of cost-cutting measures by considering the outsourcing of 26 jobs from its customer service team, specifically those in the social media department, to overseas locations.
Embarking on cost-cutting measures amid struggles
Asda is facing significant challenges as it considers shifting 26 customer service jobs overseas in a bid to reduce costs.
The recent outsourcing initiative follows a similar outsourcing effort after Asda transferred more than 100 IT positions to an Indian supplier last year as the retail giant seeks to restructure its operations.
The cost-cutting operations at Asda form a base of thorough business restructuring that intends to improve market standing. The company conducted scrapping jobs which included cutting staff bonuses while launching price competition battles to win back customer faith thus, demonstrating the pressing need for its restructuring initiatives.
Turnaround strategy amid market challenges
The company’s latest redundancy consultation comes as part of a broader turnaround strategy led by chairman Allan Leighton, who has been tasked with reviving the supermarket’s fortunes after its market share dropped from 14.4% to 12.6% over three years.
“We have opened a consultation with a small number of colleagues affected should this proposal go ahead, and our priority is to do all we can to support them during this process,” said Leighton.
As part of its efforts to recover its “DNA” and win back customer trust, Asda has launched price reductions for 1,500 products while dedicating funds to improve its stores. The UK retail leadership position becomes an elusive target for Asda following its strategic efforts to rebuild.
Industry-wide cutback trends
Asda’s decision to outsource jobs reflects a broader trend in the retail sector, where companies are seeking to reduce costs and adapt to changing market dynamics. Rival Morrisons, also owned by private equity, has recently put hundreds of jobs at risk as part of its own cost-cutting efforts.
The move by Asda to shift roles overseas echoes similar strategies by other retailers facing financial pressures, highlighting the challenges faced by traditional supermarkets in maintaining profitability in a highly competitive market.
