USA: Kellogg launches efficiency drive as earnings flatline
The Kellogg Company has initiated a new cost-cutting scheme – dubbed ‘Project K’ – which it is reported will result in a reduction of some 7% of its global workforce. This scheme was announced following the release of Kelloggs’ latest financials which reported total net earnings of $3.7 billion for Q3, a figure largley unchanged on the same period of 2012.
The aim of ‘Project K’ is to optimize supply chain infrastructure and consolidate business services across multiple regions on a global scale. Investment will be refocused on core markets, developing and emerging markets with an emphasis on brand-building activities, innovation, and infrastructure, and the implementation of global category teams.
"We are excited by the potential and opportunities we see for growth in the categories in which we operate," said John Bryant, Kellogg Company's president and chief executive officer. "As a result, we are making the difficult decisions necessary to address structural cost-saving opportunities which will enable us to increase investment in our core markets and in opportunities for future growth.”
Kellogg currently has a global workforce of around 31,000. So far the company has not specified which geographies or functions are likely to be affected by the job losses.
Source: Kellogg & media reports