ICA to save 200 million SEK
The Swedish grocery giant ICA Gruppen announces extensive changes to its organizational structure, with the goal of streamlining operations and cutting costs by 200 million Swedish kronor. That is probably not enough.
With this restructuring, ICA is taking a step towards adapting to the grocery market of the future, at least that is the goal.
Whether the largest grocery chain in the Nordic region succeeds in combining cost cuts with increased customer value remains to be seen.
Is 200 million in cost reductions enough? Probably not. ICA has a turnover of approximately 160 billion SEK and operating margin in the 4 percent range. 200 million in cost reductions will not make a revolution – it is simply not enough to fight Axfood and Lidl in the future.
ICA is losing market shares to them every day, and this writer thinks that ICA has to develop a low price concept to succeed in Sweden in the future. We, together with many other experts, are a bit astonished that it has yet not happened – not even mentioned in their strategy plans!
The reorganization, which will come into effect on January 1, 2026, affects both ICA Gruppen centrally and its subsidiary ICA Sweden, and involves significant changes in management structure, strategy, and staffing.
According to the press release from ICA, the corporate management will be streamlined, and ICA Gruppen will in future have a purer role as a holding company.
The new corporate management will consist of the CEO, CFO and CEOs of the various subsidiaries. This means that several functions that were previously centrally located will now be moved to the operational units.
Easier to adapt to local conditions
In ICA Sweden, the group's largest subsidiary, the management will be given expanded responsibility for strategy, HR, and communications.
The aim is to strengthen ICA Sweden's ability to meet customer needs at a time when price awareness and digitalization are shaping shopping patterns.
ICA emphasizes that the changes will make it easier to adapt to local conditions and give the stores more flexibility.
"We are facing a shift in how customers shop, with an increased focus on price and efficiency. To meet this, we must also change how we work internally," says CEO Nina Jönsson in a comment.
Positions will disappear
The reorganization also means that several positions will disappear. ICA states that there will be redundancies, especially within the current group functions and in ICA Sweden.
The final overview of which roles will be affected will be presented in December. It is expected that both administrative and strategic functions may be affected, but ICA promises to conduct the process with respect for the employees and in accordance with current agreements.
Mixed consequences
For ICA retailers across Sweden, the changes may have mixed consequences.
On the one hand, a more locally adapted strategy may provide better support and more relevant tools.
On the other hand, the loss of central functions may lead to more responsibility and greater demands for independence.
Several retailers have expressed concern about how the changes will affect their everyday lives, especially when it comes to access to advice and support in an increasingly competitive industry.
Customers will likely notice the changes indirectly, through adjustments to the assortment, pricing strategy, and digital services.
ICA has previously announced increased focus on online shopping and automation, and the reorganization may provide room for further investment in these areas.