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Migros is starting its biggest renovation of all time. Switzerland’s most important private employer, with 100,000 employees, is breaking away from popular subsidiaries. Sold by: travel group Hotelplan, sports retailer SportX, home electronics chain Melectronics and industrial company Mibelle (“Mobile” dishwashing liquid, “Me” series). Employees were notified of the incident at 9 a.m. Friday morning. “We examined the entire portfolio of our group,” Migros boss Mario Irminger (58) tells Blick. It turned out that the Dutti Group was no longer the real owner of this business. “Individual subsidiaries have a higher chance of success outside of Migros.” There is no shortlist for those potentially interested and no pre-sale discussions have yet taken place. Blick gets to the point of what has changed now for employees and customers.
Why does the explosion occur?
Migros can be compared to a bulky super tanker. Too big, not flexible enough, too stuck in areas that are no longer profitable. Discount stores Aldi and Lidl and major retailer rivals Coop are making it easier to steal market share, i.e. customers, from Migros. Migros is losing sales, specialist stores with large sales areas can no longer make a profit. For example, reacting quickly to changes in the growing online market: None! Migros therefore decided to concentrate on its core business areas such as supermarkets, healthcare and financial services.
Who will shake at Migros anymore?
Anything that is not profitable or no longer fits the strategy is eliminated. Irminger speaks of a “pause.” According to Migros President Ursula Nold (55), 6,500 employees will be affected by the sale of Migros’ four subsidiaries. The hope here is that new owners will take over the roster. Is Migros boss Irminger insisting on job guarantee? He avoids the idea, saying: “If possible, entire groups such as Hotelplan and Mibelle should be taken over.”
In both cases, up to 1,500 full-time positions will be eliminated due to the focus on core business. Example: If SportX is sold, the logistics established for this purpose are no longer needed. IT services don’t need to be doubled or quadrupled either. Currently, a total of 8,000 employees are worried about the future. Lest we forget: The Bestsmile teeth-straightening chain is closing nine of its 36 locations, and 40 employees are losing their jobs, as announced Friday.
What is the status of Switzerland’s largest employer?
Migros was also in a better situation. When the portfolio was examined, it was seen that values up to 500 million francs needed to be corrected. For example, logistics properties and IT projects are affected, according to Irminger. “Balance sheet values are lower and they need to be corrected.” This situation will affect the 2023 results that Migros will announce to the public in March. “Migros is not a case of restructuring,” Irminger emphasizes. His company continues to make a profit, is financially sound and is practically not financed by external financing.
Are there more sales?
Migros wants to hurry to find buyers for all four of its subsidiaries. How long is unknown. The transformation is also ongoing, because according to Irminger, not a single Migros specialist store in Switzerland is number 1 in its region. Additionally, large sales areas are becoming less and less meaningful. That’s why Obi, Micasa, Do it + Garden and Bike World are also put to the test. Here, in his own words, he leaves all options open. Migros wants to announce the fate of these special stores by this summer. It is not excluded that the company makes more sales. If there is interest, rival Coop may also step in.
How do Migros customers view renewal?
Migros emphasizes that the sales do not currently change anything for customers or affected employees. On the contrary: “Migros wants to invest over eight billion francs in its customers in the next five years,” Irminger explains. This means lower prices, new store concepts and, as the Migros boss says: “For Switzerland as a business,” around 1.5 billion francs a year. Regarding Mibelle sales, Irminger explains: Own brands, such as “Handy” dishwashing liquid or “I am” beauty products, remained on the shelves, even if they were no longer produced by Migros Industrie but by a Mibelle. An external company will do it.
Source :Blick
I’m Tim David and I work as an author for 24 Instant News, covering the Market section. With a Bachelor’s Degree in Journalism, my mission is to provide accurate, timely and insightful news coverage that helps our readers stay informed about the latest trends in the market. My writing style is focused on making complex economic topics easy to understand for everyone.
