The survival of quintessential companies like Coca-Cola is usually taken for granted, even during an unprecedented time like the coronavirus pandemic, during which many businesses are struggling to stay afloat. But the beverage giant is going through a major restructuring in order to remain strong amid declining sales, according to Restaurant Business.
The company announced last week that it would be reducing the number of its business units to focus on its most popular products. The move will unfortunately result in thousands of jobs lost at Coca-Cola in several countries. However, the company is offering a buyout to 4,000 workers in the U.S., Canada, and Puerto Rico, and said it would be extending similar deals in other countries. Current job cuts could be the biggest the company has seen in two decades.
After discontinuing their beloved line of Odwalla smoothies earlier this summer, the company suggested further product cuts are in the works. “We are shifting to prioritizing fewer but bigger and stronger brands across various consumer needs,” chairman and CEO, James Quincey, said on an earnings call in July. However, it remains unclear which products will be directly affected by the reorganization. (Related: There’s a Shortage of These Popular Beverages at Grocery Stores.)
Out of the company’s 400 brands, the smaller ones account for over 50% of the company’s portfolio, but only generate around 2% of revenue, Quincey said. The company’s new strategy will be focused on further developing products in categories with the greatest growth potential, like the Coca-Cola line, as well as sports drinks, coffees, teas, sparkling water, and plant-based milks. (A prime example: Earlier this month, Coca-Cola announced it will be debuting a new coffee-plus-soda hybrid drink early next year in the U.S.)
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