Uncertainty over store and staff future

Sainsbury’s and Argos stores in East Kilbride are under threat of closure as part of a £500m cost-cutting drive.

Up to 15 Sainsbury’s supermarkets, 40 Sainsbury’s Local stores and 70 Argos stores across the UK are to be shut down over the next five years.

But in its latest trading update, the company failed to say what the shake-up means for staff or stores affected.

East Kilbride has an Argos in Sainsbury’s superstore at Kingsgate Retail Park and a Sainsbury’s store in the Olympia mall.

But Sainsbury’s, which bought Argos in 2016, said it also planned to open around 10 new supermarkets, relocate 80 Argos outlets into its supermarkets and open 110 new local stores.

CEO Mike Coupe said: “Sales momentum was stronger in all areas and we further improved our performance relative to our competitors, particularly in grocery.

“We have focused on reducing prices on every day food and grocery products and expanding our range of value brands, which have been very popular with customers.

“At the same time, we are investing significantly in our supermarkets, driving consistent improvements to service and availability.”

The group raised its target for debt reduction to at least £750m over three years, with plans to lower it by at least £300m in the 2019-20 financial year alone.

It also highlighted the pressure of rising prices as it looks to cut down on costs.

The store closures will save around £20m a year, but the cost of shutting down branches will be up to £270m, according to Sainsbury’s second-quarter update.