Kroger, the United States' largest supermarket chain operator by revenue, is reportedly letting go of hundreds of middle-management employees as part of its attempt to further cut costs.
The layoffs are apparently happening simultaneously all across the country with hundreds of employees being given advanced notices.
A company spokesperson confirmed the initial reports of the mass firings stating that it was part of the company's constantly evolving store operations. The spokesperson mentioned in a prepared statement that the measure was part of an ongoing talent management strategy that will be evaluating various middle management roles and structures to ensure proper resource management.
It was also stated that each of the store divisions has been given the privilege of operating independently, but the company wants to make sure that they are hiring the right talents in the right positions. Apart from that, the spokesperson did not reveal any further details on the company's future plans.
A report from a website that tracks employment in the United States called TheLayoff.com revealed that the layoffs were taking place in two of Kroger's largest stores in Los Angeles and Atlanta.
As of last month, Kroger operates 2,759 supermarkets and department stores across 35 states, either directly or through its subsidiaries. The company employs close to 500,000 employees throughout its different supermarkets, superstores, hypermarkets, jewelry stores, and department stores.
Kroger was originally founded by Bernard Kroger in 1883 in Ohio and started out as a small grocery store. The business eventually grew to become the fifth-largest retailer in the world and the second-largest in the US, right behind Walmart. The company is currently ranked No. 17 on the Fortune 500 list based on total revenues generated. In 2016, the company generated revenues of around $115.34 billion for its fiscal year.
The mass layoffs come just after a month of the company's latest conference call, where its CEO Rodney McMullen promised shareholders that he would be keeping a close eye on its expenses.
While discussing the company's second-quarter earnings, McMullen mentioned that he will be imposing measures to cut costs to help the firm's bottom line in the coming quarters. McMullen specifically mentioned that he will strive to remove around $1 billion per year in costs out of the company.
Kroger is aiming to significantly increase its earnings before interest and taxes in the coming years. The company does expect its operating profits to grow by a significant margin in the coming years.