Retailers

Kroger to Restructure Corporate, Tech Positions

Efficiency part of $1B annual cost reduction fueling Restock investment
Photograph: Shutterstock

The Kroger Co. is undergoing a “transition” that will affect an unspecified number of corporate office employees in Cincinnati, a spokesperson for the company confirmed to WGB this week.

The company, in the meantime, said it would add about 140 positions as part of a restructuring of its technology and digital group, with many of its current associates to be promoted based on changing responsibilities through the transition.

The moves are part of the retailer’s ongoing Restock Kroger initiative, the three-year journey designed to ensure the company is positioned to meet the changing needs of shoppers and changing shopping modalities. Restock, which was launched in fiscal 2018 and completes at the end of fiscal 2020 in early February, contemplates achieving $1 billion in cost savings annually and investing those savings back into the business, with an emphasis on talent, pricing, digital growth and the customer experience, while supporting a financial return goals.

Kroger officials in a presentation this week said the company was on track to meet the $1 billion goal this year. A portion of those savings are achieved through what Chief Financial Officer Gary Millerchip described as “administrative efficiencies” and productivity improvements through process improvements, automation, sourcing and waste reduction.

A spokesperson asked about unverified corporate headcount reductions, which were posted online, said in a statement:

“Our company continues to transform and make decisions that enable innovation, efficiency and allow us to operate with greater speed. We are evolving the way we work and modifying roles within a few corporate office teams to make sure we can continue to deliver a seamless customer and associate experience.”

The spokesperson said no store positions were to be affected in the restructuring, but declined to specify the amount of positions in corporate that could be affected by the changes.

A year ago, Kroger’s regional operating divisions made a number of changes to roles of its salaried managers and coordinators, resulting in hundreds of layoffs. More recently, Walmart enacted some similar changes at its stores, changing the roles of salaried managers, co-managers and some hourly workers, resulting in fewer, but higher-paid and more versatile roles for workers there.

Industrywide, cost reductions are helping to fuel investment in digital shopping transitions. Albertsons and Ahold Delhaize are also in the midst of ambitious cost reduction programs.

Kroger this week also acknowledged it was transforming its technology and digital group, saying it anticipated the team would grow by 140 total positions, with a number of current associates to be promoted “based on added responsibilities throughout this transition,” the spokesperson told WGB.

“In the coming weeks, more than 500 open positions will be posted and all associates will have an opportunity to apply for those roles.The positions are a combination of newly created roles as well as adjustments to existing roles that reflect changes in scope and responsibilities.”

The spokesperson declined to address specifics of that move at this time, saying the job openings have not been posted.

“We are proud to be one of Cincinnati’s largest employers with nearly 32,000 associates in the region. In 2018, we began our Restock Kroger three-year transformation journey to ensure our teams can better meet the needs of our associates and customers. These efforts to transform our business ensured we were well-positioned to support customers and associates throughout the COVID-19 pandemic,” the spokesman added. “We appreciate every associate and their contribution to our company, and we are committed to supporting everyone through this transition.”

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