Sobeys Streamlines Executive Positions as Stock Rises
STELLARTON, NS - Continuing on its previously announced Project Sunrise restructuring plan, Canadian grocer Sobeys has announced it will continue to streamline its executive positions in order to limit costs and grow its bottom line. According to source The Chronicle Herald, Sobeys said it would be eliminating 75 executive positions at different offices across Canada.
“The grocery business is highly competitive and our regionally-based structure slowed us down. As we move to a national, functionally-led company we have an aggressive goal to transform our organization and leverage our size and scale,” said Michael Medline, President and Chief Executive Officer, in a statement.
As we previously reported when Sobeys announced the plan in May of this year, Project Sunrise was designed to deliver $500 million in annualized savings by 2020. At the time of the announcement, the company said that cost savings will come from the following:
- Collapsing multiple, independent regions into a largely national, functionally-led structure. This will simplify the way the company conducts business and will result in a reduced workforce
- Simplifying how the company collaborates with vendors while leveraging its purchasing scale as a $24 billion national company
- Driving enterprise-wide efficiencies and productivity initiatives
According to Medline in a statement to The Telegram, after Sobeys completes Project Sunrise, the company will have a simpler, leaner structure, be more efficient, and better prepared to leverage its $24-billion national scale.
“Change of this magnitude is not easy on our employees, but we remain committed to making tough decisions, and executing the necessary changes, to ensure our future success,” he continued. “This will free us up to be extremely nimble, grow market share, and thrill our customers in the more than 1,500 communities that we will continue to operate in.”
As of 2 PM EST on Tuesday after the announcement went public, Empire Company, Sobeys’ parent company, saw its stock up 41 cents, or 1.88 per cent, to $22.25 from $21.84 as of Tuesday’s market close.
To read more about Sobey’s Project Sunrise, read our previous article about the initiative here.