Closures loom as Coop losses increase
The Local · 20 Feb 2006, 14:00
Published: 20 Feb 2006 14:00 GMT+01:00
Coop Denmark and Coop Sweden both returned profits.
"We didn't keep up with the competition on prices in time," said Coop Sweden's managing director Thomas Evertsson to TT.
The Swedish operation has been in a state of crisis for many years. 2004's loss of 100 million kronor was just a taster and the almost half billion kronor deficit in 2005 has hit the overall results of Coop Norden hard. Profit for the parent company slumped from 209 million kronor in 2004 to 68 million kronor last year.
Consequently Norwegian Coop has decided to hive off the Swedish operation to avoid being dragged down by its losses. Last summer a national management team was reintroduced but there are no plans to split up the company.
"The issue is not under consideration today," said Evertsson.
However, the company is implementing a series of savings measures. The details are yet to be revealed but it is clear that many smaller stores will be ditched. Costs must be reduced by hundreds of millions of kronor a year.
"It will mean staff cutbacks but I can't say how many hundreds it will be," said Thomas Evertsson.
"Despite our savings plans we have in the last four years established 25 supermarkets and 10 superstores. That will lead to efficiencies - customers want big stores."
Evertsson is also counting on pushing down the prices of suppliers.