Media Markt to cut 3,500 jobs

Ceconomy (the former Metro branch that owns electronics chains Media Markt and Saturn) has announced a thorough restructuring, which may cause up to 3,500 jobs being cut and several stores closed all over Europe.

Standardisation

Media Markt and Saturn will move towards a “group-wide standardized organizational structure“, Ceconomy states in a press release. The electronics group wants to harmonise its structures and introduce “standardized, efficient processes and procedures for the administrative functions” in its country organisations. Moreover, CEO Berhard Düttmann wants to standardise management structures throughout Europe and reduce administrative tasks for its staff.

National branches and country managers will therefore lose part of their independence, as Düttmann leans more towards central management, German Handelsblatt reports. The CEO is reportedly of the opinion that liberties for different countries and even individual stores is more of a hindrance than an advantage in today’s digital world: they slow down innovations and block centrally designed price and assortment campaigns. Another point of irritation is the lack of synergies between both constituent electronics chains.

Fewer jobs and stores

The reduced footfall since the Covid-19 pandemic is also leading Ceconomy towards closing non-profitable stores, but it is as of yet unknown how many and which stores would be involved. The CEO says that stores will retain their important roll in Ceconomy’s omnichannel strategy, but will have to adapt to changing customer behaviour. The relative importance of e-commerce has now grown to 35 % of the group’s total turnover, and this has not reduced since stores have reopened in May or June.

This new focus puts some 3,500 jobs at risk, mostly outside of Germany. Next week, Ceconomy, will decide how many jobs will be cut – and where exactly. The whole procedure is estimated to cost 180 million euros, but in turn save over 100 million euros per year.