This morning, PepsiCo announced that it would be trimming 8,700 employees — 3 percent of its global workforce — as part of a cost-saving program intended to recoup $1.5 billion in projected expenditures over the next three years.
News of the cuts confirmed expectations reported over the past month, and came as the company reported its fourth-quarter and full-year 2011 results.
In addition, the company announced a variety of strategic objectives for 2012, including an increased marketing spend behind “iconic” brands. Here are some key takeaways, below:
- Globally, Pepsi’s snack business is growing at a faster rate than its beverage business (8% vs 3%)
- Despite increasing 9% for the year, net revenue for Pepsi’s North American beverage division decreased 1%. Volume declined 4% for the quarter and 1% for the year.
- Pepsi’s North American business saw slight volume growth in non-carbonated beverages thanks in part to “high single digit growth” in volume for Gatorade, 35% growth in Trop50, and 6% growth in Lipton.
- CSD volume declined “mid single digits” in North America for the year.
Additionally, there were key statements for the year to come:
- In 2012, the company will spend an additional $500-600 million on advertising and marketing, with most of it being focused on North America. The company says that it will focus on iconic brands and on bringing innovation to market.
- Implement a three year “productivity program” that will result in savings of $1.5 billion over the next three years.
- Reduce headcount by 8,700, which represents about 3% of the company’s global workforce. Cuts will come by trimming headcount across 30 countries.
- Sums up 2012 as “A Transition Year, with Accelerated Productivity, Stepped-Up Brand Investment, and High Commodity Costs”
Read the full press releases: