AO moves jobs out of UK despite boom in profits
Online electrical retailer AO World is offshoring up to 200 UK call centre roles to South Africa despite an increase in profits.
The retailer said the move was “in response to ongoing inflationary cost pressures, and particularly rising employment costs”. It said it expected to save about £4m a year as a result of the shift.
About 150 roles in phone sales and enquiries have already been switched from AO’s call centre in Bolton to South Africa over the past year or so. A further 50 are expected to go. About 100 further roles, handling more complex customer queries, are expected to remain in the UK.
AO said its employee numbers fell by 340 to 2,800 in the year as it made efficiencies across the business.
AO said on Wednesday that pre-tax profits had risen by 145% to £50.5 million in the year to 31 March, enabling it to pass £20m in special payments to shareholders.
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John Roberts, the founder and chief executive of AO, said: “What government is doing is accelerating the cost equation at the same time as technology is accelerating its capability and cost [reduction].”
He added that the fall in youth employment experienced by the UK lately was “nothing to do with AI and robotics” but “about terrible government decisions”, which had made it more expensive and risky to hire inexperienced workers with new measures such as more rights from the first day of employment.
Roberts warned that new rules on zero hours would make it difficult to take on temporary staff during busy periods such as Black Friday and Christmas, as employers could have to offer those workers similar hours in the slow January period.
Roberts said the group now had the strongest balance sheet in its history, “delivered against a backdrop of rising costs”.
AO said sales rose 11.4% to nearly £1.3 billion in the year and had continued well with a 17% surge in TV sales in May as households prepared to watch the men’s football World Cup.
It also said it had carried out “a small-scale, exploratory trial during the year to test the use of robotics within our warehousing operations”. AO said early results “are encouraging” and it was now beginning to do further tests in its live operations.
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