Coke expects job cuts to result in annual savings of between $350 million and $550 million.
Photo: Steven Senne/Associated Press
Coca-Cola Co. KO 0.50% said it is cutting 2,200 jobs globally, including 1,200 in the U.S., as the coronavirus pandemic accelerates the soda giant’s restructuring efforts.
The Atlanta company, which had about 86,000 employees at the start of the year, has been trimming expenses and products amid the closures of restaurants, bars, movie theaters and sports stadiums that sell its drinks around the world.
The reductions amount to roughly 12% of the company’s U.S. workforce. Coke will make the job cuts through a combination of buyouts 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 didn’t say how many people participated.
Coke’s North America business unit will be reorganized to look more like other units around the world. Until now in North America, the company’s fountain-machine business, bottle-and-can business and Minute Maid operations each had their own teams for marketing, communicating with retailers and coordinating with bottlers. Those teams will be consolidated, the company said.
Coke expects the job cuts to result in annual savings of between $350 million and $550 million, the spokesman said. The latest cuts include about 500 jobs in the Atlanta metro area, where the company is based.
Coke this year also said it would slash its 430 master brands by about half, to 200, narrowing its beverage portfolio to products that are growing and can achieve a large scale. It is retiring its Tab soda and Zico coconut water brands, and earlier this year closed its Odwalla juice and smoothie business.
The restructuring will allow the company to function more like a network needing “less decision making, less bureaucracy and ultimately less people,” Coke finance chief John Murphy said in a November interview.
When a company faces such an immediate disruption in sales, “it really forces you to re-evaluate through a more stringent lens,” he said, referring to the blow to Coke’s business from the pandemic.
Coke reported revenue of $8.65 billion in the quarter ended Sept. 25, a decline of 9% from a year earlier but an improvement over the second quarter, when its revenue fell by 28%. Profit in the latest quarter fell about a third from a year ago to $1.74 billion.
Beverage rivals PepsiCo Inc. and Keurig Dr Pepper Inc. haven’t announced mass layoffs this year.
The restructuring doesn’t affect Coke’s bottling operations, which are mostly independent. Those bottlers employ hundreds of thousands of people around the globe.
Write to Jennifer Maloney at [email protected]
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