Harris Teeter parent outsourcing work to India. Thousands of jobs at risk: report
The parent company of Harris Teeter plans to shift jobs to a back-office and tech operations center in India and eliminate thousands of U.S. jobs, according to multiple news outlets and an industry analyst.
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But it’s unclear yet how the move could impact workers R Charlotte’s hometown grocery store chain.
The Kroger Co. is developing a center in Bengaluru, India, where it can shift numerous job functions to save hundreds of millions of dollars, Cincinnati Business Journal reported last month. Bengaluru, also known as Bangalore, is about two hours from Mumbai.
That move to India could mean the loss of more than 5,700 jobs in the U.S., industry analyst Brittain Ladd told the newspaper. The move is part of Kroger’s plan to save $500 million, Ladd said on LinkedIn.
Ladd did not respond to The Charlotte Observer’s request for comment.
“Any estimates of headcount reduction are premature and irresponsible,” Kroger said in a statement to The Charlotte Observer.
The company did not answer how or if the change could impact Matthews-based Harris Teeter, a subsidiary of Kroger. Harris Teeter referred The Charlotte Observer to Kroger for comment.
While Kroger has not provided official public statements regarding its center in India, company executives have referenced the plan during recent earnings calls.
Kroger Chief Financial Officer David Kennerley first mentioned the center during the March fourth-quarter earnings call. The initiative is designed to streamline decision-making, improve productivity and increase speed, he said.
CEO Greg Foran, who joined Kroger in February, said during that call that the Kroger Capability Center is one of the areas where the company sees opportunities to improve and address costs.
During the first-quarter earnings call in June, Foran briefly referenced the center again.
“We need to operate more efficiently,” he said. “That means fewer organizational layers, smarter ways of working, standing up our Kroger capability center and applying AI across the business.
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The Kroger Capability Center in India is one strategy for lowering operational costs that will mean lower prices for customers, Kroger said. “It complements the modernization work underway across the organization,” the company said in its statement to the Observer.
For instance, Kroger Technology & Digital is transitioning roles to the new center in India, according to a LinkedIn post last month by India’s Global Capability Center career intelligence platform.
“This marks another Fortune 500 retailer recognizing India’s talent depth for back-office and tech operations,” GCC ERA said. The platform said grocery retail, historically anchored in the U.S., is now joining the more than 1,800 Global Capability Centers it tracks across both traditional and emerging industries. The positions being relocated generally involve process-heavy tasks, such as supply chain analytics, finance ops and vendor management, according to GCC ERA.
Kroger Technology & Digital is comprised of more than 4,600 employees, according to the retailer’s LinkedIn.
Kroger recently shifted plans for distribution in the Charlotte region.
In January, the company quietly canceled plans for a $92 million, 200,000-square-foot automated delivery fulfillment center in Concord that was projected to bring 692 jobs.
The newly constructed building off N.C. Highway 49 South currently sits vacant. To terminate its contract for the Concord site and close three other active fulfillment centers, Kroger is paying a $350 million cash settlement to its U.K.-based technology partner, Ocado Group.
The move is part of the grocery giant’s shift away from automated warehouses to expanding delivery partnerships with third-party apps like Instacart, DoorDash and Uber Eats.
Kroger pulled out of similar economic agreements before. In Groveland, Florida, Kroger recently shuttered an active facility and laid off 935 workers, prompting local officials there to seek $1.5 million in compensation.
Kroger is the largest traditional grocer in the U.S. Based in Cincinnati, it has 2,700 locations in 35 states. Along with Harris Teeter, Kroger has two other regional grocers including Ralphs and Fred Meyer. The company has more than 400,000 employees.
Harris Teeter has 35,000 employees at 250 stores in North Carolina, South Carolina, Virginia, Georgia, Maryland, Delaware, Florida and the District of Columbia. There are nearly 11,000 employees in North Carolina.
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