Despite a $586 million quarterly revenue and receiving $67 million in wage subsidies, The Warehouse Group says it needs to cut costs to remain viable.
On Monday, the company announced a restructure, under which it would move to an agile working model and look to close nine stores, resulting in the loss of up to 1080 jobs.
Group CEO Nick Grayston said the changes were "pre-planned" and COVID-19 had accelerated the process.
"We've got a lot of wastage in our operating model. This is about working more efficiently."
In the three months to April, group sales were $586.3m, down 18 percent.
He did not expect a post-lockdown shopping surge to continue, nor would it make up for lost sales under alert level four.
"For us to remain viable, we have to manage our costs so we can keep competitive."
Grayston said the $67m it got from the wage subsidy covered just over half of monthly staff overheads.
"That subsidy goes through to 17 June: we won't qualify for the next subsidy that goes to 1 September, which is why we have to make adjustments," he said.
Feedback from customers indicated that spending would drop as economic conditions worsen, he said.
"For example, 49 percent of our customers told us that they've already started restricting the purchase of everyday items, 25 percent have said 'we've slammed on the brakes' and 76 percent [expect] tough times ahead."
He said he feels for those losing their jobs but acknowledges that staff were employed on full salary during lockdown. If the business had been classified as 'essential' and allowed to trade during lockdown, redundancies could have been delayed.
"This was already preplanned and so we would have done it eventually: we might not have needed to do it quite so urgently."