Winn-Dixie To Lay Off 11,000
The ax fell Thursday at supermarket giant Winn-Dixie, which is cutting 11,000 jobs and closing 114 unprofitable stores, factories and offices.
The job cuts and closings will eliminate 8 percent of all the jobs in the 14-state chain, including detergent and bag factories in Jacksonville, division offices in Tampa, Atlanta and Louisville, and a warehouse in Tampa.
Charles Wolever, head of security at the Tampa warehouse, says employees got the word Thursday morning. Asked if he personally is concerned about losing his job, he replied: "Who wouldn't be?"
Another worker, who declined to give her name, says the cutbacks had been rumored so "it isn't a complete surprise."
"Today's grocery business is probably the most competitive in our 75-year history," explains company chairman Dano Davis. "These changes are absolutely necessary to provide Winn-Dixie with an effective infrastructure to train and support operations management teams."
Store workers will bear the brunt of the restructuring, which includes the retirement of 10 vice presidents. The company says it expects to save $400 million a year as a result of the cuts in the 1,189-store chain's payroll and overall operations.
Competitors and others in the industry are taking notice. "It makes a lot of sense, they are circling the wagons," says Kevin Coupe, vice president of Ideabeat.com, an Internet company dealing with food and retailing. Coupe also suggests the cutbacks may make Winn-Dixie more attractive to buyers.
Winn-Dixie is the nation's sixth largest supermarket chain, ranking behind Kroger, Albertson's, Safeway, Ahold and Wal-Mart.
The Jacksonville-based chain has focused in the last five years on building and remodeling more than 900 stores, primarily under the Winn-Dixie Marketplace banner.
Stores operate in Florida, Georgia, North Carolina, South Carolina, Alabama, Mississippi, Louisiana, Kentucky, Ohio, Tennessee, Indiana, Virginia, Texas, Oklahoma and the Bahamas.
Winn-Dixie has not yet released a list of the 114 stores it is closing. Company spokesman Mickey Clerc says fired employees will get severance packages and accrued benefits. "They will be notified as expeditiously as possible and closed as expeditiously as possible." An average store has 85 employees.
The Tampa warehouse and division office, with about 200 employees, and the bag and detergent plants with a total of 62 employees, will close by the end of June, also the end of the fiscal year Clerc said. Division offices in Atlanta, with 75 employees, and Louisville, with 60 employees, face the same closure dates.
Winn-Dixie had earlier announced the sale of 74 stores in Oklahoma and Texas to Kroger.
The company also reported third quarter sales of $3.20 billion, down $4.2 million from the same period last year. Profits were $10.3 million, or seven cents a share, down from $58.8 million, or 40 cents per share, for the same period last yearAnalysts surveyed by First Call/Thomson Financial has been expecting earnings of 22 cents per share.
Winn-Dixie earned $13.5 million, or 9 cents per share, on $14.1 billion in sales last year.
CBS Worldwide Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report