Retail major Target’s Geelong headquarters shifting plan after chopping 180 jobs has evoked a mixed response. Target will be moving to a new base in the west of Melbourne by early 2017 and is launching a redundancy program for the employees by May. It has 900 staff in Geelong.
Announcing the plans, Wesfarmers managing director Richard Goyder said, Target would cut staff strength in Geelong and move the headquarters to Melbourne, reports The Sydney Morning Herald.
The move comes close on the heels of the discount store’s rebate scandal engineered by some of its staff. The scandal had director Stuart Machin resigning after rebate deals with suppliers for boosting the retailer’s first-half earnings were unearthed. Goyder noted that seven senior staff has already moved out after the rebate scandal.
“We’re advising people today in Geelong that we will relocate the Target head office somewhere west of Melbourne in the next year or so and that’s so we can attract some of the people we want to bring into the business and frankly we do want to drive some change through the business,” added Goyder
The Australian Services Union slammed the relocation plan and called it a “disgrace.” The Union’s Victorian branch secretary, Ingrid Stitt said: “We now find out they are walking away from the Geelong community altogether, Geelong can ill afford another blow to the local economy like this.”
However, several analysts backed the move by noting that Geelong location had a role in the recent rebate accounting scandal. Federal Labor MP Richard Marles also urged Wesfarmers to treat the Target staff with respect.
According to CEO of Wesfarmers department stores division, Guy Russo, after enforcing the redundancies many remaining jobs will be moved to the new headquarters in Melbourne and some personnel will be inducted in Geelong’s Kmart, reports The ABC.
Defending the downsizing, Russo said: “To ensure Target is profitable and sustainable, some hard decisions have had to be made.”
In Russo’s view, Geelong head office has not been a viable option to remain competitive and be profitable for shareholders, customers and the 20,000 team members of the retailer’s network.