Danish Crown has announced it is cutting 150 jobs to reduce costs and “trim” functions as it begins a six-month restructuring process.
The meat processor hopes to save DKK400m (US$58.5m) annually as part of the group-wide changes, which involve streamlining each area of the business.
At least 100 of the positions cut will be in Denmark, mostly within the Danish Crown unit, it said in a statement today (30 January). “Group functions will also be trimmed,” Danish Crown added.
It follows the announcement last week that the co-operative was closing a 200-employee facility in Germany in order to save costs. Today it said this was the “first step” in streamlining the business, and added: “What happens at the group’s factories and abattoirs in the coming year will largely depend on market developments.”
Jais Valeur, Danish Crown group CEO, said China’s growing domestic pork production coupled with Russia’s invasion of Ukraine and global inflation has turned the pork market “upside down”.
“These are drastic changes which have happened in a very short space of time,” he said. “We can’t influence market trends but we can do something about our own business. We based our strategy on a stable and strong market and a positive outlook. Now, everything has been turned upside down and we’ve had to rethink the way in which we can achieve our goals.”
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The simplification of the company will also include merging or shutting down sales companies outside Denmark, Danish Crown said.
Valeur said it was “very sad” but that the company had “no other choice”.
“Costs, efficiency and a tight supply chain all the way from the farmer to the consumer are central to the current market situation,” he said. “This is why I would also like to stress that it is not because individual employees have not lived up to their responsibilities, but because of the extraordinary situation that we’re faced with and which, unfortunately, requires a rightsizing of the organisation.”
Last year the company announced potential job cuts in Denmark, though structural reshuffling reduced total losses from 350 staff to 140.
In November, Danish Crown announced plans to build a UK pork facility for the supply of bacon and gammon.