Delivering a keynote address at the Association of Corporate Growth’s Mergers & Acquisitions symposium, Heinz chairman, president and CEO William R. Johnson told his audience that the efforts he has overseen to restructure and refocus the ketchup-giant have positioned Heinz for strong future growth.
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Lauding the value of the Heinz brand name, Johnson said: “The Heinz brand, which accounts for roughly a third of our nearly US$9bn in global sales, is a unique, omnipresent trademark that encompasses everything from our famous ketchup and condiments, to soup, beans, pasta, sauces, vinegar, pickles and infant foods. The bond between the Heinz brand and consumers is both strong and emotional.”
Johnson said that since the formation of Heinz’ strategic plan in 2002 the company has honed in on its 15 leading brands in three key categories: ketchup and sauces, convenience meals and infant nutrition. “We have shed nearly $3bn in annual revenue, exited more than 50 plants, eliminated numerous layers of management, simplified the organisation structure, put new systems and processes in place, upgraded our talent and made several strategic acquisitions, like Lea & Perrins, HP Sauce, Classico pasta sauces, and the license for T.G.I. Friday’s,” he said.
Johnson said that Heinz’ simplified management structure and cost-cutting initiatives were beginning to yield improved margins. “We are fuelling top-line growth through significant cost cuts aimed primarily at driving efficiency in our global supply chain, coupled with further rationalisation of our manufacturing base. We are well on our way to meeting our goal of exiting an additional 15 plants this year, which will leave Heinz with fewer than 75 plants across the globe,” he said.
Johnson maintained that by cutting costs and refocusing the company, “Heinz is now on a solid foundation for growth, with the right mix of people, products, places and processes.”
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