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Wolseley announces £100m reorganisation to offer 'highest customer service levels'

Plan will see 80 branch closures and up to 800 job losses as wholesaler unveils distinct offerings for large and small customers

Wholesale giant Wolseley UK – owner of the Pipe Center and Plumb Center brands - has announced a £100 million programme to transform the way it serves its customers following a wide-ranging review of its plumbing and heating operations.

The principle move is to divide its customer offering into two distinct areas: serving large and medium sized customers with a comprehensive national service and a series of 80 ‘destination branches’ open 7 days a week; and providing a ‘local branch’ structure to smaller customers comprising around 450 branches. £40 million of the investment will be to refurbish branches and install the latest technology

The second move is to consolidate the sales network together – creating one organisation, to provide larger customers with a single point of contact, ‘to help provide specialist knowledge and geographic coverage whilst providing a more consistent and seamless service.’

This reorganisation will result in the closure of around 80 branches and up to 800 job losses over two years.

The company said: “We will develop Wolseley as our go-to-market brand for our larger regional and national customers and over time simplify our roster of other brands. We will continue to invest in training and developing our people to ensure we offer the best service consistently across our network. We will improve our pricing to become more competitive and attractive to our customers especially on the products that matter to them. Our service offering to our customers will also be truly multi-channel, providing a seamless way of doing business through branch, sales, on-line, or on the telephone.”

This will be supported with Wolseley’s current logistics infrastructure, creating new transport hub locations to deliver products nationwide with ‘consistently high standards of both branch replenishment stock and customer orders’.

The new structure will see the Worcester Distribution Centre subject to a feasibility review, as only three locations will be required.

Overall, the reorganisation will take two to three years to complete and is expected to deliver annualised cost savings of £25 million to £30 million

The company said its plan is based on ‘a deep understanding of what its customers value and what makes them successful; maintaining and growing its specialist expertise; and delivering a step change in operational efficiency and consistency.’

It said the aim is to make the company ‘the first choice specialist for trade customers delivering the highest levels of customer service in the industry coupled with a leaner, more efficient operating model which will significantly improve service levels, product availability and choice.’

There will now follow a period of consultation will now commence with colleagues at affected sites, with the company stressing it is too early to provide details of which branches will close, either by region or brand identity.

Patrick Headon, Managing Director of Wolseley UK, said: “We have put the customer at the heart of this review with the aim of making Wolseley the first choice specialist merchant in our chosen markets. We have a great business in the UK and there are continued opportunities for growth. I’m confident the transformation programme will drive better customer service and employee engagement and improve our financial returns. The trends in our profitability have been disappointing and we need to take action to improve our customer proposition and the efficiency of our business. We have an outstanding team made up of hard working and dedicated people across the UK and we are very conscious of the impact this transformation of the business will have on some of them. We are therefore committed to carrying out this programme as sensitively as possible, using voluntary means to achieve the proposed headcount reductions wherever possible. Over time I’m confident our proposals will benefit both our colleagues in the UK and the customers they serve every day.”

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