FrieslandCampina has announced that it is accelerating the execution of its transformation strategy in Germany, which will include the loss of 195 employees.
The German subsidiary is accelerating cost-cutting measures during the impacts of Covid-19, as part of its transformation strategy that it launched two years ago.
The news comes after FrieslandCampina re-evaluated its global ‘Our Purpose, Our Plan’ strategy on 10 November 2020, in which it highlighted its growing relevance and the need to accelerate its execution.
At the time, Hein Schumacher – CEO of Royal FrieslandCampina – specifically highlighted that profit margins in the Netherlands, Belgium and Germany remain under pressure, with needs to further increase productivity in these countries’ supply chains.
With the aim to further invest in the Germany market to improve performance, FrieslandCampina Germany says it plans to focus more on its strong brands and scale back the production of unprofitable products.
In order to reduce costs, the dairy cooperative is cutting 195 full-time jobs at the production sites in Heilbronn and Cologne (while also furthering investment in these dairy plants). This forms part of the approximately 1,000 jobs that the company said it would reduce by the end of 2021, mainly in the Netherlands, Belgium and Germany.
Other moves announced on 10 November include cuts to its portfolio, potential divestment of non-core assets, and the implementation of a new route to market for the infant nutrition business in Hong Kong and southern China.
The closure of FrieslandCampina’s production facility in Rijkevoort, the Netherlands, earlier this year is also in line with this strategy.
“We do not take such steps lightly but the accelerated implementation of our strategy is necessary in the current situation to tap into new growth potential and to achieve sustainable growth in the market,” said Jan Kruise, managing director at FrieslandCampina.
Kruise added: “Germany is an important, strategic home market for FrieslandCampina. This year we have achieved significant revenue growth of 7% with our core brands Landliebe, Chocomel, Valess, Tuffi and Holland Master.
“This is the result of the commercial strategy that we successfully launched two years ago, and that we are now going to accelerate.”
© FoodBev Media Ltd 2024
