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Lincolnshire Co-op has said it will cut 27 jobs from its pharmacy warehouse as part of a series of changes across its business to cushion the impact of rising costs and falling turnover and trading profit.

The company, which employs over 2,770 people in its food, pharmacy, post office, travel and funeral homes businesses, has started a collective consultation with 42 employees who work at the pharmacy warehouse which supplies medicines to the Lincolnshire Co-op’s pharmacies.

The company also said it wants to move supply to existing third-party suppliers which already make deliveries to its pharmacies. It said it is working with its union Usdaw “to explore all options and mitigate compulsory redundancies”.

Lincolnshire Co-op’s turnover fell by 1.2 per cent and trading profit (EBITDA) by 35 per cent during the first six months of the financial year.

It said its business strategy includes a “new focus on healthcare and housing, as well as substantial investment in systems and technology to make (it) more efficient”.

Lincolnshire Co-op CEO Alison Hands said rising costs, including significant increases in the national living wage and national insurance, had forced the company to act.

“Many businesses across the UK are experiencing challenges – and Lincolnshire Co-op is not immune to that,” she said.

“However, we do have a strong balance sheet and reserves, as well as an investment plan which supports growth of our business to ensure we are able to serve our communities for many, many years to come.

“This plan includes new technology such as electronic shelf edge labels and self-checkouts in food stores, and improved IT systems across all our business areas.”

Insisting Lincolnshire Co-op had “to take difficult decisions, including reviewing our ways of working”, Hands added: “To enable us to achieve our plan, we also have to make sure we are managing our costs carefully, balancing profitability as well as alignment with our strategy and community purpose, and our future direction and growth.”