Woolworths has announced a significant cost-cutting initiative of AUD 400 million in response to a challenging financial period that has led to a AUD 190 million decline in profits.
The supermarket giant has planned to streamline operations by reducing its product range and cutting office jobs. However, specific details regarding job losses and discontinued grocery lines have not been disclosed.
It has been reported that the company’s chief executive, Amanda Bardwell, outlined the cost-saving strategy and stated that the reductions would be focused on areas where consumer demand for specific products has been low.
The announcement followed a reported 20.6 percent decrease in net profits, which has been attributed mainly to lower grocery sales during a 17-day industrial action in late 2024. This action resulted in additional supply chain costs.
After facing legal action from the ACCC over alleged price-gouging claims, Woolworths has been under increasing scrutiny. The company also suffered disruptions due to industrial strikes that impacted its Victoria and New South Wales distribution centres.
Amidst these challenges, Woolworths continues to focus on maintaining customer engagement. While customers still choose to shop at Woolworths, many purchase fewer items and diversify their shopping across multiple retailers, including Bunnings, Costco, and Amazon, particularly for non-food items.
The company has also reviewed its other divisions, including its New Zealand business, Big W, and PETstock.
