Soft drink manufacturer Coca-Cola which has a subsidiary in Kenya has announced plans to retrench over 2,200 employees globally as a result of reduced sales during the Covid-19 pandemic period.
Reliable sources revealed the company will retrench 1,200 employees in the US and 500 in Atlanta where it is headquartered.
“We are in the process of building an organizational structure that will address” customers’ needs and behaviours, the company said. “The pandemic was not a cause for these changes, but it has been a catalyst for the company to move faster.”
The reductions, totalling 2.5 per cent of the company’s total workforce, involve a combination of voluntary buyouts and layoffs, a spokesman said Thursday via email.
Coke had about 86,200 employees at the beginning of the year, including 10,400 in the US.
Severance packages are expected to cost the company between sh 35 billion ($350 million) and sh55 billion ($550 million)
Exits will entail voluntary and forced separations, according to reports.
The company also plans to reduce its number of operating units from 17 businesses in four regions to nine operating units in those areas.
Coca-Cola’s profits for the third quarter shrunk by nine per cent to $8.7 billion, attributed to reduced sales after several restaurants closed down due to Covid-19.
Shares of Coke, which has a market value of $230 billion, rose less than 1 per cent in afternoon trading. The stock is down 3per cent so far in 2020.