January 31, 2023

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Elkjøp cuts staff, closes stores – E24

The electronics giant warns that personnel costs will drop by an estimated 12 percent.

Elkjøp cuts staff.
published:

Electronics chain Elkjøp will cut staff at some of its stores and at the head office in Nydalen, E24 confirmed.

It is estimated that this involves a staff reduction of 12 percent on average, and the termination of operations in a “few” stores.

According to Managing Director Linda Frid Andresen, it is too early to say anything concrete about how many human years will be directly affected by the changes. They also don’t want to go to stores that are closed.

Personnel costs should be adjusted by an estimated 12 percent, Andersen says.

She explained that the goal is to finish as quickly as possible, to ensure that it does not become a lengthy process.

Linda Fred Andersen, CEO, Elkjøp.

– asked for time

“It’s a tough time for retail, with an extreme situation in terms of price and margin,” Andersen says.

She notes that a weaker krone, lower demand and higher inventories have put operating profits under pressure.

We are in a demanding period and we must prepare for the market to be difficult for longer than expected.

At the end of April, the company had 86 stores in Norway. At that time, the company had 1,886 years in business, according to Elkjøp Norge’s annual accounts.

I tried to simplify

According to Andersen, a number of measures were taken in 2022 to reduce costs and make operations more efficient, but this was not enough.

– It is a difficult message for our employees to receive and a difficult decision for Elkjøp as a company to make. I have a great understanding of the disruptions this is causing, and we will do what we can to help and support our employees in the time to come. She says this is the most important thing we do right now.

Read on E24+

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Significant decrease in results

Elkjøp has struggled financially recently.

Written in December today’s work about how the challenges deprived the billion-dollar group of nearly all of its operating profits.

It ended at NOK 22 million in the first half of 2022, down from NOK 672 million in the previous year. It was the weakest operating result in several years.

It’s an incredibly difficult time for retail, Elkjøp Nordic CEO Erik Sønsterud told the newspaper.

While large parts of commodity trade experienced a rebound during the pandemic, the time afterward was characterized by high price growth and weak demand.