Procter & Gamble to cut 7,000 jobs, exit brands in new restructuring
NEW YORK: Procter & Gamble will cut 7,000 jobs, or about six per cent of its workforce, over the next two years, as part of a restructuring that will include the Tide maker exiting some product categories in certain markets.
The two-year restructuring plan comes as consumer goods giants P&G and Unilever brace for muted demand in 2025 stemming from growing uncertainty due to US tariffs.
"This is not a new approach, rather an intentional acceleration of the current strategy...to win in the increasingly challenging environment in which we compete," P&G executives said at a Deutsche Bank Consumer Conference in Paris on Thursday.
The initiative could likely include some divestitures, the company said, without providing additional detail.
President Donald Trump's sweeping tariffs on trading partners have roiled global markets and sparked concerns of a recession in the US.
The Pampers maker imports raw ingredients, packaging materials and some finished products into the US from China, while the vast majority - roughly 90 per cent - of what it sells is produced domestically, P&G has said.
The company on Thursday estimated about US$600 million before-tax hit in its fiscal year 2026, based on current tariff rates.
The trade war has cost companies more than US$34 billion in lost sales and higher costs, a Reuters analysis showed, a toll that is expected to rise.
In April, P&G said it would raise prices on some products and that it was prepared to pull every lever in its arsenal to mitigate the impact of tariffs.
Pricing and cost cuts were the main levers, CFO Andre Schulten had said then.
On Thursday, Schulten and P&G's operations head, Shailesh Jejurikar, acknowledged that the geopolitical environment was "unpredictable" and that consumers were facing "greater uncertainty."
The company had about 108,000 employees as of June 30, 2024, and said the job cuts would account for roughly 15 per cent of its non-manufacturing workforce.
P&G expects to record charges of US$1 billion to US$1.6 billion before-tax over the two-year period, with a quarter of the charges expected to be non-cash.
The restructuring would help simplify the organisational structure by "making roles broader" and "teams smaller", the company said.
The plans to divest certain brands will also help adjust its supply chain in order to reduce costs, P&G said.
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The Star
4 hours ago
- The Star
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Malay Mail
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