Target Corporation is reportedly sacking about 500 people, but increasing staffing to improve service for customers.
The American big-box retailer said in an internal employee memo obtained by CNBC that it was changing the way it ran and oversaw stores, reducing the number of store districts and increasing the number of hours worked by frontline store employees.
According to the memo, Target is laying off around 500 people, including about 100 at the store district level and about 400 across its supply chain sites, CNBC reported in this article.
“This change also fuels our ability to put significantly more payroll in our stores – primarily in additional labour and hours where needed most, but also in new guest experience training for every team member at every store,” the email said.
The email written by Chief Stores Officer Adrienne Costanzo and Chief Supply Chain and Logistics Officer Gretchen McCarthy was sent to employees in its headquarters and store field teams on Monday.
CNBC quoted a Target spokesperson as declining to say how much additional investment was planned in stores and saying starting wages for store workers, which range from $15 to $24 per hour depending on the location, would not change.
Target is expected to detail its turnaround strategy on 3 March at an event for investors at its Minneapolis headquarters.
Target (NYSE: TGT) shares closed three cents (0.026%) lower at US$115.52 on Monday (Tuesday AEDT), capitalising the company at $52.05 billion (A$73.3 billion).
The shares have fallen 12% over the last year but have bounced back from a 12 month low of $83.44 reached in November.
