Ongoing consolidations among food companies and a highly competitive operating climate has forced Kraft Heinz to purge 2,500 jobs, with 700 positions to be eliminated from the company’s co-headquarters in Northfield, Ill.
Insiders within the Northwest Arkansas supplier community expect this will impact local jobs within these two Wal-Mart suppliers. Heinz and Kraft each have their own sales teams devoted to Wal-Mart on the ground in Benton County. In most cases when large suppliers merge there will be no need for duplicated jobs in social media or shopper marketing as well as senior team leaders for each separate entity, according to industry experts.
“As we work to build something special at The Kraft Heinz Co., the leadership team has examined every aspect of our business to ensure we are operating as efficiently and effectively as possible,” said Michael Mullen, senior vice president of corporate and government affairs. “We have developed a new streamlined structure for our organization to simplify, strengthen and leverage the company’s scale. This new structure eliminates duplication to enable faster decision-making, increased accountability and accelerated growth.”
The first earnings from the recently merged company showed sagging sales of 4.9% at Kraft while sales dropped 4.1% at Heinz. At Kraft lower prices and weak demand were attributed to the sales decline. Heinz said its results were a result of unfavorable currency exchange rates amid a high U.S. dollar.
In the second quarter ended June 27, Kraft Foods posted net earnings of $551 million or 93 cents a share, compared to $482 million or 81 cents a year ago. Net sales revenue declined nearly 5% to $4.515 billion.
For Heinz, the second quarter ended June 28 produced a loss of $164 million. A year ago the condiment maker had net income of $127 million. Revenue fell 4.1% to $2.616 billion.