Job Cuts and Return to Office Mandate at THGJob Cuts and Return to Office Mandate at THG THG, a Manchester-based e-commerce company led by CEO Matthew Moulding, has announced layoffs of 171 employees and implemented a mandatory five-day-a-week office policy. Layoffs Attributed to Automation and AI THG cited automation and the use of artificial intelligence (AI) as the reasons behind the job cuts. The company has been restructuring its operations to leverage these technological investments and improve efficiency. However, THG has committed to supporting affected colleagues and exploring alternative roles within the group. Return to Office Policy The company has also ended flexible working arrangements due to inconsistent adherence to its policy. Employees are required to be physically present in the office for the entire workweek. Financial Performance and Restructuring THG reported a pre-tax loss of £252 million for 2023. Despite a revenue increase in Q4, the company’s performance has faced challenges. The job cuts and restructuring are part of THG’s strategy to improve profitability and drive growth for its Ingenuity e-commerce platform. Sale of Luxury Division As part of its restructuring, THG has sold its luxury division, including Coggles, to Frasers for £43 million. However, the business has been incorporated into THG’s Ingenuity portfolio. Outlook THG’s recent actions demonstrate its focus on operational efficiency and profitability. The company remains committed to its growth strategy, leveraging automation, AI, and its Ingenuity platform to expand its e-commerce business.
THG is cutting 171 jobs across several departments and has ordered all employees to work in the office five days a week. The company says the layoffs are necessary due to automation and the use of AI in the company.
The Manchester company, founded by outspoken CEO Matthew Moulding, has cut its workforce by almost a third over the past two years following a major cost review.
After the letter to all employees was leaked to the Financial Times, a THG spokesperson said: “As a company, THG is committed to continually improving operational efficiency to best serve our global customer base.
“As part of this continued focus, THG is restructuring some areas of the business to ensure we continue to leverage recent investments including in automation, technology and AI. Subject to ongoing consultation, these changes are likely to result in a limited number of roles becoming redundant. While this is regrettable, THG will support all affected colleagues and seek to offer them alternative roles within the Group.”
Regarding flexible working arrangements, the internal memo states that “adherence to the policy has been inconsistent”.
In April, THG reported a pre-tax loss of £252m for the 12 months ended December 31, 2023.
In a later trading update, Moulding said: “After the group returned to revenue growth in Q4 2023, it is pleasing to report an acceleration in the first quarter. This is testament to the hard work and dedication of our people, who have remained focused on the task at hand despite the challenging macroeconomic backdrop.”
The restructuring and job cuts are part of THG’s strategy to improve profitability and generate more external business for its e-commerce platform Ingenuity, following a challenging period since its IPO in London in 2020.
THG has sold its luxury division, which includes retail brand Coggles, to Mike Ashley’s Frasers for £43m, but has added the business to its Ingenuity portfolio.
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