5/18/2009 10:55:00 AM
Weekend Papers: Vodafone to speed up cost-cutting
Vodafone is expected to use its full-year results tomorrow to announce an acceleration in its £1bn cost cutting programme.
Vittorio Colao, Vodafone’s chief executive since July, used his first strategy presentation in November 2008 to announce the cuts.
He outlined a plan to cut the company’s operating expenses by £1bn by March 2011, mostly at its European businesses. About £500m of savings were due by March 2010, and another £500m by March 2011.
Vodafone is also expected to say it will no longer give revenue guidance, after cutting sales forecasts twice during 2008-09, partly because the economic downturn hurt some of its core European mobile businesses.
Vodafone suffers set back on South Africa plans
Vodafone suffered a set back in its plans to gain a controlling stake in one of Africa’s biggest operators when a local regulator pulled its support of the deal.
South Africa’s telecoms watchdog reversed an earlier decision to wave through the UK mobile giant’s $2.5bn purchase of an additional 15% stake in Vodacom, its 50-50 joint venture with state-controlled Telkom, following a court action to block the deal by the country’s trade union federation.
Carphone Warehouse kills commission
Carphone Warehouse will replace its ‘car salesman’ image by slashing individual commission payments for its staff with a new bonus payment system, as of July.
Mobile reported last week that the retailer would end a long heritage of individually rewarding its best sellers by cutting commission payments in favour of a store performance based bonus system.
Carphone’s UK chief executive, Andrew Harrison, said: ‘Customers think this industry has been more akin to estate agency or car salesmen. That is not what our business is built on.’
After a trial of the new system in London stores since October, Carphone has decided to extend the new system to its stores nationwide.
Carphone said fears that the non-commission trial in London would see an exodus of experienced staff to rival firms, were not realised.
The retailer said turnover of staff had gone down and basic wages were raised from £11,000 to £17,000 per annum.