Woolworths Group (ASX:WOW) Updates on Supply Chain Industrial Action
Ongoing Industrial Action
Woolworths Group has announced significant disruptions due to ongoing industrial action at three distribution centres in Victoria and one in New South Wales. The United Workers Union (UWU) commenced strike actions on 21 November, which have now extended to 12 days. The union is seeking pay increases exceeding 25% over three years.
Negotiation Efforts
Woolworths Group has been engaged in good faith negotiations with the UWU for over four months. Despite multiple offers made above local market rates, negotiations remain unresolved as the UWU’s demands include the elimination of performance standards, affecting productivity management.
Impact on Sales
The industrial action has already negatively impacted Australian Foods sales by approximately $50 million, with future financial effects uncertain. The impacts are expected to continue until the action is resolved, particularly affecting product availability during the busy Christmas trading period.
Commitment to Customers
Woolworths Group is deploying contingency plans to minimise customer impact, including inventory management and leveraging distribution networks. CEO Amanda Bardwell expressed regret for the disruptions, stating, “We sincerely apologise to all of our customers for the inconvenience caused by the inconsistency of supply across some product lines in some of our stores. We are working hard to try and improve the situation and would like to thank our customers for their understanding and for treating our teams with respect.”
Woolworths Group remains committed to resolving the industrial action and will provide updates as necessary.
Motley Fool contributor Lianne Eastty has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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