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Since the pandemic hit, sales had dropped to about 50% of last year’s and the company was forecasting it would take two years to rebuild to 80% of previous earnings.
Describing it as an "incredibly tough decision", chief executive Greg Jolly said the "unavoidable truth" was the business must realign its costs with turnover.
"By taking this step now, we believe we can get through this massive disruption and come out the other side in a position to grow and once again offer work opportunities to our local community," he said in a statement.
TGP — one of Australasia’s largest wholesale suppliers of promotional products — has been an Otago success story since it was founded by Jim Robertson in Lawrence in 1987.
It moved to Fairfield, on the outskirts of Dunedin, in 2013.
Last year, it won the best medium international business award in the Otago export awards, and was seventh nationally in the Deloitte Fast 50 Master of Growth results.
Staff were told yesterday about 30% of the workforce would be cut.
That news came after more than five years of 30% to 40% annual revenue growth, during which time the company had created nearly 300 new jobs.
Mr Jolly, his senior management team and the company’s board had a "relentless focus" on rebuilding the business and it was hoped those job opportunities would be available again in the "not too distant future".
It had been a dramatic and swift shift in trading conditions but the company was not alone; some of its international colleagues were planning for a 70% reduction in revenue.
"We need to dramatically change the way we operate and, sadly, that means we cannot sustain current staff numbers. Despite our people being our biggest asset, wages are our biggest cost. Reducing our workforce is the only way we can survive the enormous financial impact Covid-19 is having," Mr Jolly said.
The company had appreciated the speed with which the Government introduced the wage subsidy in March.
That meant it had been able to retain all 350 employees and allowed time to "crunch the numbers" and forecast what the immediate and medium-term future looked like, Mr Jolly said.
While it had been granted the extended wage subsidy, it had chosen to work through the restructure as early as possible to ensure all the time available was utilised for staff.
"During the consultation process, we are hopeful solutions can be worked through that will save more of our people their jobs, reduced hours being one example," he said.
There was no doubt the business could survive the dramatic reduction in sales and had the flexibility to respond swiftly, should there be any upswing.
"In some ways, we have a lot to be thankful for, compared to other industries," he said.
The final number of redundancies and the employees impacted would not be confirmed until the conclusion of the consultation process.