P&G to Cut Non-Manufacturing Jobs
According to Reuters.com, Procter & Gamble (P&G) plans to cut a total of 5,700 non-manufacturing jobs as part of a new plan to reduce costs by $10 billion by the end of fiscal 2016, Chief Executive Officer Bob McDonald said on Thursday.
The world's largest household products company has about 57,000 non-manufacturing employees among its total workforce of about 129,000.
P&G had already said it would cut 1,600 positions in the current fiscal year. On Thursday, it said it would cut another 4,100 jobs during fiscal 2013, which begins in July.
The company expects to save a total of $800 million from the job cuts, executives said at the annual Consumer Analyst Group of New York, or CAGNY, conference in Boca Raton, Florida. P&G also trimmed its profit forecast due to the pending sale of its Pringles snacks business.
In total, P&G aims to trim $10 billion of costs, including $1 billion in marketing costs and $3 billion in overhead costs.
After years of expanding, bringing products such as Gillette Guard razors to India and Pantene shampoo to Brazil, P&G realized that it needs to be more nimble in order to ensure strong growth, especially in emerging markets, at a faster clip.
P&G is still the largest consumer products maker but it has been hit by some performance issues lately. For example, it could not make enough of its new Tide Pods detergent for a major in-store marketing push and it had to rescind price increases on items such as Cascade dishwasher detergent after competitors decided not to raise their prices.
Some analysts expected a smaller restructuring plan, and seemed to believe that the new plans could finally be enough to push P&G back to a more dominant stance.
"It's what they need to do," says UBS analyst Nik Modi, who said that given P&G's size, there is a lot of opportunity for improving productivity, "you just have to find it."
To read this article in its entirety, click here.
Related Articles: