Kraft Foods is to cut around 1,600 jobs across North America as it prepares to split the business into two.
The job cuts are part of Kraft’s plans to create a global snacks company and a North America-based grocery firm before the end of the year.
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The company is revamping its US sales network, restructuring where its management in North America is based and streamlining its corporate organisation.
All cuts will take place in US and Canada in 2012. Around 20% of the cuts are open positions, the company said.
Kraft said around 40% of the job cuts will come from realigning its US sales division. The company plans to employ two sales agencies to assist in working with retailers. Acosta Sales & Marketing will represent Kraft with the US food giant’s grocery store and mass retail customers. Crossmark will be Kraft’s agent with convenience retailers. Kraft said it anticipates the completion of its US sales reorganisation by 1 April.
Meanwhile, the company’s snacks business will move to offices in Mississauga, while the firm’s beverages business unit in Tarrytown, New York, and its Planters brand in East Hanover, New Jersey, will relocate to the Chicagoland area by December.
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By GlobalDataOverall, Kraft will reduce its US management centre locations from four to two.
Kraft said the future global snacks company – yet to be named – will have its headquarters in the Chicagoland area, with the choice of site currently under consideration. The North American unit for the global snacks company will be based in East Hanover.
“When we announced our decision to create two world-class companies last August, we said both would be leaner, more competitive organisations,” said Kraft chairman and CEO Irene Rosenfeld. “For the past year, the North American team has been working to streamline operations to deliver sustainable top-tier performance and continue to invest in our iconic brands. We’re confident that this transformational work will improve effectiveness and fuel the future growth of both companies.”
