Why THG made 171 job cuts and ordered staff back to the office
THG is to cut 171 jobs across various divisions and has ordered that all staff work from the office five days a week insisting that automation and the use of AI in the business has made the cuts necessary.
The Manchester-based business, founded by outspoken chief executive Matthew Moulding, has now reduced its workforce by almost a third over the past two years following a major review of costs.
Following a leak of the letter to all staff to the Financial Times, a THG spokesperson said: “THG is committed to continuously improving operational efficiency as a business to best serve our global customer base.
“As part of this continuing focus, THG is restructuring some business areas to ensure we continue to leverage recent investments, including in automation, technology and AI. Subject to the ongoing consultation, these changes will likely result in a limited number of roles becoming redundant. Whilst this is regrettable, THG will support all affected colleagues and seek to offer them an alternative role within the group.”
On the flexible working arrangements the internal memo said that “adherence to the policy has been inconsistent”.
In April, THG reported a pre-tax loss of £252m for the 12 months ended 31 December 2023.
In a later trading update Moulding, said: “Following the group’s return to revenue growth in Q4 2023, it’s pleasing to report an acceleration in Q1, which is testament to the hard work and dedication of our people, who’ve remained focused on the task in hand despite the tough macro-economic backdrop.”
The restructuring and job cuts are part of THG’s strategy to improve profitability and secure more external business for its Ingenuity ecommerce platform following a challenging period since its London stock market listing in 2020.
THG has sold its luxury division, including the retail brand Coggles to Mike Ashley’s Frasers for £43m, but has added the business to its roster of Ingenuity.
