Coca-Cola slashes workforce by 2,200 amid COVID-19 strains
18 Dec 2020 --- The COVID-19 pandemic has accelerated The Coca-Cola Company’s restructuring efforts, with the soda giant now planning to cut 2,200 jobs globally, including 1,200 in the US.
This closely follows the company’s October announcement of its plans to slim down its portfolio, as part of a strategic review.
Globally, the company oversaw around 86,000 employees at the start of the year and has been reducing its expenses amid the closures of venues for its beverage sales in foodservice outlets across the world.
A spokesperson of the company details that Coke will make the job cuts through a combination of buyouts and layoffs.
In August, the company offered voluntary separation packages to around 4,000 employees based in the US and Canada. The company did not detail how many people participated in the scheme.
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Cola-Cola’s retired brands now include TaB diet soda, Coca-Cola Life, Odwalla, Zico and Diet Coke Feisty Cherry.Coca-Cola anticipates the job cuts to amount to annual savings in the range of US$350 million to US$550 million, the company spokesperson notes. The latest cuts comprise an estimate of 500 jobs in the company’s headquarters of Atlanta, Georgia, US.
Beverage giant slims down
Plans to streamline the company’s beverage lineup were underway well before the COVID-19 outbreak, but the pandemic promoted leadership to move faster. Ongoing COVID-19 supply chain challenges and shifting shopping behaviors prompted the company to fast-track its plan.
The beverage heavyweight’s retired brands now include TaB diet soda, Coca-Cola Life, Odwalla, Zico and Diet Coke Feisty Cherry, as well as regional offerings like Northern Neck Ginger Ale and Delaware Punch.
Meanwhile, Vegitabeta (Japan) and Kuat (Brazil) are among the products the company’s leaving Coca-Cola’s international portfolio.
Last August, Coca-Cola’s bottler Coca-Cola HBC revealed a drop in H1 profits. Net profit declined to €124 million (US$146 million) during this period, compared to €195 million (US$231 million) a year earlier.
Portfolio expansion targets
As part of its restructuring efforts, Coca-Cola is focusing on building brands that prioritize scale in an effort to accelerate growth amid this challenging period.
In strategic launches this year, the beverage giant announced plans to launch Topo Chico Hard Seltzer into Latin America in 2021, as the trend for low-alcohol drinks continues to proliferate.
Last February, Coca-Cola announced that it was tapping into disruptive categories with a new focus on “breakthrough beverages,” targeting beverages in emerging categories – including kombuchas with less sugar, cultured ciders, keto-friendly smoothies and cold-brew coffees – in “record time.”
Edited by Benjamin Ferrer
