A restructuring plan that is soon to be implemented by the global soft drinks giant Coca Cola will see a reduction of about 2,200 jobs in its global workforce.
The novel coronavirus pandemic has already hit the business of the company hard because of widespread shutdowns of events and venues where the company’s soft drinks are sold the most and the planned restructuring of the company has been accelerated by this health crisis related slowdown in business.
According to reports, the plans of the restructuring by soft drinks giant will hit the US hardest where the company has estimated a total job loss of about 1,200.
There were about 86,000 employees in the company y globally at the end of 2019. However the restructuring has become inevitable as the company’s revenues have been hit by the slowdown induced by the pandemic.
Consumers drinking its beverages away from home typically account for more than half of the total sale revenues of the company. However during the pandemic, social restrictions impose din major parts of the world to slow down and prevent the spread of the pandemic by governments have resulted in mass closures of bars, restaurants, cinemas and sports stadiums – the very places where the company’s drinks are sold most. This has hit the sale of the company’s soft drinks in a significant manner.
Announcement of voluntary layoff packages for 4,000 of its workers in the US, Canada and Puerto Rico was made by the company in August this year.
According to the calculations of Coke, the job cuts will help the company to make an annual saving of between $350 million and $550 million, said spokesman for the company.
The response of Coke to the pandemic related health crisis has been to plan and implement a company-wide restructuring of its business as well as trimming down its product portfolio to save costs.
Under the restructuring plan, the comp[any would be cutting down on the number of brands it owns by more than half – from 430 master brands to about 200. Instead the company had drawn up plans of focusing on those products that are showing growth and have exhibited the potential to achieve a large scale.
Earlier this year, the company closed its Odwalla juice and smoothie business and is on the verge of retiring its Tab soda and Zico coconut water brands.
A drop in revenues of 9 per cent year on year, at $8.65bn, was reported by the Atlanta, US based company for its latest completed quarter.
No jobs at the bottling plants of the company would be affected by the planned job cuts because most of those plants are independent and run by third parties. Hundreds of thousands of people around the globe are employed by the bottling plants of the company.
(Adapted from BBC.com)