Labour action takes toll on Dis-Chem
A strike led to longer delivery lead times, more investment in security, and the relocation of 400 staff from Midrand for security reasons
A protracted labour dispute compounded the difficulty faced by healthcare product chain Dis-Chem, which — like other companies in the retail sector — had to cope with a struggling economy. But the company managed to grow revenue 10.7% to R9.4bn for the 22 weeks to February 2. This increase came despite the national strike by the National Union of Public Service and Allied Workers (Nupsaw), which was anticipated to cost the group R50m in lost income and additional cost. The group warned that the strike, which started on November 16 and was supported by 2,300 of its 15,000 staff, had affected operations at three of its four distribution centres, and was expected to push earnings growth below its guidance range of 16% to 24%. “The impact on our business as a result of the prolonged period and intensity of the strike has been more severe than was initially estimated,” the group said in a trading update. The industrial action had resulted in longer delivery lead times, increased investme...
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