PepsiCo, the American
food corporation is laying off workers from its North American divisions
headquarters. This indicated that corporate cost reductions and tightening are
now extending beyond technology and media companies.
The layoffs will
affect the company’s beverage business in North America’s Purchase, Harrison,
New York and also the snacks and packaged food business based in Chicago and
Plano, Texas, The Wall Street Journal reported.
The multinational
intends the layoffs to “simplify” the organisation to make the operations more
efficient. The cuts will be comparatively higher in the beverage business as
the other unit has already reduced the number of positions after a voluntary
retirement scheme.
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The snack dominant sells
Doritos, Lays, Cheetos, Ruffles Tostitos, Fritos, Walkers, Quaker Oats and
more. As of December 2021, the company employed about 309,000 people worldwide,
and around 129,000 only in the United States.
The demand for its
food and beverage products remained strong in grocery stores despite hiking
prices that have discomforted many consumers. PepsiCo and its rival food
companies have been increasing their prices to neutralize higher costs of
inputs, including transport and labour.
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The company reported a
nearly 9% jump in the third quarter of 2022 against the corresponding quarter
last year. The net profit of the company jumped over 21% against the year-ago
quarter and net profit margins were recorded at 12.3%.
The unfavourable
economic growth forecasts in the current environment with continuously raging
inflation in all industry segments have moved them towards applying
cost-cutting techniques.
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PepsiCo now joined the
string of companies that have announced layoffs in the past weeks. This
includes Walmart, Amazon, Meta, Twitter and more. Ford Motors has announced plans to trim white-collar jobs. Google’s parent, Alphabet, has also recently called to
lay off around 10,000 “poor performing” employees, or 6% of its workforce.
