The country's oldest department store chain Shoppers Stop is laying off more than 1,100 employees as well as shutting down some stores on account of decline in sales and a bleak consumer demand outlook on account of COVD-19.
About 15% of the 7,500 staff strength, mostly junior and mid-level workers have been asked to resign by June 15, as per an ET report. These include 160 people in the back-end operations and over 1,000 front end store-level employees.
While the company confirmed layoff plans but said it will re-hire from the same set of people once the situation begins to improve. The affected employees will be given two months’ salary on an immediate basis.
The retailer stated that the retail industry has witnessed attrition rates in stores between 36-50%. It expects that a large part of the migrant workforce, working with them on a contractual basis, may not return until the pandemic situation takes a turn for the better.
The move comes as like other retailers, with declining business, the retailer is being forced to close lower performing and unsustainable stores and resort to layoffs to its cost base. Shoppers Stop has reopened 55 of its 90 department stores after a gap of more than two months. However many brick and mortar retailers expect online shopping to drive sales as they relook at their business models amidst expectations of lower footfall in stores for the coming months.
The pandemic has taken a toll on the retail sector globally. Global retailers such as Gap, Best Buy, Macy's, and Kohl's have laid off over 2.5 lakh employees since March.