Coca Cola Co.
KO 0.38%
he said it is reducing 2,200 jobs worldwide, including 1,200 in the U.S. as the coronavirus pandemic accelerates soda giant restructuring efforts.
The Atlanta-based company, which had about 86,000 employees earlier this year, has been cutting spending and revenue amid closures of restaurants, bars, movie theaters and sports stadiums that sell its drinks around the world.
The reductions account for approximately 12% of the company’s U.S. workforce. Coca-Cola will reduce jobs through a combination of shopping and layoffs, a spokesman said. In August, it offered voluntary separation packages to about 4,000 employees in the U.S. and Canada. The company did not say how many people participated.
Coke’s North American business unit will be reorganized to look more like the rest of the world’s units. Until now, in North America, the plumbing business, the company’s bottle and can business and Minute Maid’s operations each had their own equipment for marketing, communication with retailers and coordination with the bottlers. These teams will be consolidated, the company said.
Coke expects the job cuts will lead to annual savings of between $ 350 million and $ 550 million, the spokesman said. Recent cuts include about 500 jobs in the Atlanta subway area, where the company is headquartered.
Coca-Cola also said this year that it would cut its 430 master brands by about half, to 200, reducing its beverage portfolio to products that are growing and can reach a large scale. He removed the Soda Tab and Zico coconut water brands and earlier this year closed the Odwalla juice and smoothie business.
The restructuring will allow the company to function more as a network that needs “less decision-making, less bureaucracy and ultimately fewer people,” Coke chief financial officer John Murphy said in an interview in November.
When a company faces such an immediate disruption in sales, it “really forces you to re-evaluate through a stricter target,” he said, referring to the pandemic blow to Coke’s business.
Coca-Cola posted revenue of $ 8.655 billion in the quarter ended Sept. 25, down 9 percent from a year earlier, but an improvement from the second quarter, when revenue fell 28 percent. Profit for the last quarter fell about a third from a year ago, to $ 1.74 million.
PepsiCo drink rivals Inc.
and Keurig Dr. Pepper Inc.
they have not announced mass layoffs this year.
The restructuring does not affect Coke’s bottling operations, which are mostly independent. These bottlers employ hundreds of thousands of people around the world.
Will the coronavirus pandemic lead to long-term changes in the way we buy food? To better understand the challenges grocery stores face, Alexander Hotz of WSJ spoke with an industry expert, a store owner and a Walmart executive.
Write to Jennifer Maloney to [email protected]
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