Vodafone plans a reorganisation that will cost 300 jobs and wipe #20 million off its profits in its current financial year. The mobile phone operator will also splash out on its biggest ever corporate image revamp.
Hailed as the most significant restructuring of Vodafone's distribution strategy ever, the changes will reduce the business areas covered by the operator's six service provider partners to three, and will unify the five billing systems and 12 brands used by those partners.
Over the past year, Vodafone has doubled the number of service providers to six, and increased its number of retail outlets to 300. The service providers, which include Vodac, Talkland, and People?s Phone, currently run five different billing systems and customer care units, plus manage 12 different brands, and 87 separate tariffs. ?Within this array, there is clear scope for rationalisation and improving business performance,? said the company.
Vodafone will reorganise the activities of the six providers into three businesses, each concentrating on a separate market sector - corporate customers, small businesses and consumers. It is expected that they will move to one billing platform and two customer care systems.
Around 300 of the 3,500 staff employed by the units will be casualties of the restructuring. Over the next 18 months, redundancies will be made at Vodafone?s offices in Cheltenham and Cricklewood.
The three businesses, and Vodafone's wholly owned shops, will trade under a revamped Vodafone brand identity. Rival phones from Orange, Cellnet, and One2One will no longer be sold in these shops, which have had their premises, literature and vehicle livery redesigned to the tune of #15 million. A futher #35 million will be pumped into promoting the new Vodafone brand.
Vodafone is the UK?s biggest mobile telephone company but connected fewer new subscribers in the second quarter than its rivals. It won 53,000 net new subscribers in that quarter, and expects to connect a net 350,000 to 400,000 this year. The company ended its fiscal year with a 25 per cent increase in turnover to #1.75 billion.
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