Cell C head office. Picture: ALAISTER RUSSELL
Cell C head office. Picture: ALAISTER RUSSELL

Mobile operator Cell C said on Friday that it expects to close about 128 stores across the country, more than half its retail footprint, with 546 jobs on the line as it seeks to cut costs and restructure its operations.

The job cuts will be in addition to Cell C’s plans to lay off 960 workers, announced in June.

“The retail environment has changed and this has been fast-tracked by the impact of Covid-19 and the evolving purchasing habits of consumers,” Cell C, which is not listed and is 45% owned by Blue Label Telecoms, said in a statement.

“Much as banks are moving away from bricks-and-mortar branches, Cell C is embracing digital solutions and driving digital inclusion by leveraging collaborations and partnerships.”

The company has a workforce of 2,500 and 240 stores.

The consultation process for the job cuts announced in June started on July 30 and the company said it subsequently made a voluntary severance package offer.

Earlier in August Cell C, which has struggled to turn a profit since its formation in 2001, said it was making good progress with finalising its recapitalisation plan that will improve its liquidity and debt profile.

These efforts have included cost savings through procurement cuts, a year-long hiring freeze, and a review and discontinuation of certain products.

SA is grappling with one of the world’s highest unemployment rates, at about 30%, with estimates that it could reach as high as 40% by the end of 2020.

Companies such as MultiChoice and Telkom have embarked on similar action to that of Cell C in the past year, citing changes in technology and shifts in customer behaviour that have reduced the need for a number of roles.

Reuters

With Mudiwa Gavaza

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