The Makro department store chain is making savings. Open contracts aren’t threatened, but the chain will expire fixed-term contracts over the next twelve months. Management reported this in a press release on Thursday. There are 100 to 200 fixed-term contracts that Makro will not renew. There are also a number of commercial changes, such as the introduction of self-scan registers and fewer books in the range. Strikes have already broken out in two branches. “The staff is the victim,” the unions are dissatisfied.
The management announced the plans on Thursday at a joint meeting of the works councils of the six branches (Deurne, Eke, Machelen, Sint-Pieters-Leeuw, Alleur and Lodelinsart). The company speaks of “initiatives to deal with the structural costs that are hindering the economic development of macro”. In its own words, the management wants to improve the competitiveness of the branches, namely with “maximum retention of employment, especially of employees with a permanent contract”. “On the contrary, fixed-term contracts will gradually expire in 12 months.”
100 to 200 temporary jobs
“The figures are different for each store, 100 to 200 temporary employees for all stores together,” explains CEO Vincent Nolf. “This is a way to protect perpetual contracts.” These fixed-term contracts are not terminated immediately, they are not renewed. “There are no closings or collective layoffs.”
The chain has been struggling with problems in our country for some time. In July, for example, there was a strike in Machelen over a job loss. A month earlier there was a strike in Lodelinsart, partly against the workload. And in 2016 there was another restructuring of the chain. In 2018, the chain carried out a commercial overhaul to attract more customers. The company is now talking about “commercial success” and higher sales, but Makro “is still making losses because high structural costs stand in the way of profitability”.
This change in approach “clearly led to a change,” assures the CEO. In previous years, sales declined by double digits compared to the previous year, ie by -10 percent and more. In 2019, the chain was on the verge of stabilizing with a 1.5 percent drop in sales. That number improved to just above zero, and then came the corona crisis with sales increasing 20 to 40 percent in April, May and June thanks to hoarding behavior. According to Nolf, this strong increase in sales was not enough to convert the loss into profit.
Less books, more bread
Macro is also announcing a few other changes that should also lower costs. For example, the range of books and magazines will be phased out or adapted to local needs, while there is now a wide range. Makro will phase out the range of smoking products and end it completely in 2021. And then there is the bakery. It mostly works traditionally today, with the bread and the like that is baked in the morning. As a result, there is sometimes no longer an offer at late times, says the CEO. Therefore, Makro switches to “baking” bread products in the store.
There will also be self-checkout counters for customers in a hurry. Here’s macro behind other players as it sounds. The availability of the cash registers is increased by self-scan registers. According to Nolf, more than 45 percent of customers have fewer than five items. The internal organizational structure has also been simplified.
Strikes broke out
The unions are not happy with the plans they believe came about without social advice. The staff will pay the bill according to a statement from BBTK, ACV Puls, CNE and ACLVB. “These savings will only benefit staff if employment conditions, schedules and functions change without social advice,” denounced the green, red and blue unions. According to them, there will be “an unprecedented number of headcounts being cut” and “unbridled flexibility and automation”. The employees are the victims of the plan.
Management information meetings are being held today in the six branches (Machelen, Deurne, Eke, Sint-Pieters-Leeuw, Alleur, Lodelinsart), says Stijn Vandercruysse from ACLVB. In Deurne and Machelen, the shop doors were closed and the employees went on strike.
“Management made a unilateral decision that has profound implications for the organization of work and the privacy of workers,” said the union secretary. The measures were imposed without consultation. Everyone is aware of Macro’s financial situation, they say, but “we don’t understand that no dialogue is possible or counter-proposals can be made”.