Beverage

Coca-Cola to cut business units from 17 to 9

The restructuring will include staff buyouts and layoffs, the company said.
Coca-Cola restructuring
Photograph: Shutterstock

The Coca-Cola Co. is restructuring the company from 17 business units to nine, a process that will include offering employee buyouts and making some staff layoffs.

The changes are intended to help Coca-Cola Co. pursue its Beverages for Life strategy with a portfolio of drinks positioned to capture growth in a fast-changing marketplace, the company said.

“We have been on a multiyear journey to transform our organization,” said Chairman and CEO James Quincey. “The changes in our operating model will shift our marketing to drive more growth and put execution closer to customers and consumers while prioritizing a portfolio of strong brands and a disciplined innovation framework. As we implement these changes, we’re continuing to evolve our organization, which will include significant changes in the structure of our workforce.”

The creation of nine operating units under four geographical segments, along with the Global Ventures and Bottling Investments units, will streamline the organization by replacing 17 business units and groups, Coca-Cola said.

To focus on innovation, marketing efficiency and effectiveness, Coca-Cola is reinforcing and deepening its leadership in five global categories with the strongest consumer opportunities. Those categories are:

  • Coca-Cola
  • Sparkling Flavors
  • Hydration, Sports, Coffee and Tea
  • Nutrition, Juice, Milk and Plant
  • Emerging Categories 

The company will also launch Platform Services, an organization that will work in service of operating units, categories and functions to create efficiencies and deliver capabilities at scale across the world, Coca-Cola said. This will eliminate duplication of efforts across the company and is built to work in partnership with bottlers, the company said. 

The company did not say how many positions will be cut through the restructuring other than noting that employees who choose to take a separation package will be offered enhanced benefits. Those benefits will be offered to about 4,000 employees in the United States, Canada and Puerto Rico who have a most-recent hire date on or before Sept. 1, 2017, Coca-Cola said. A similar program will be offered in other countries.

The global severance programs are expected to cost Coca-Cola between $350 million to $550 million.

Atlanta-based Coca-Cola Co.’s brands are Coca-Cola Zero, Fanta, Sprite, Dasani, vitaminwater, Powerade, Minute Maid, Simply and Gold Peak, among others.

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.

Multimedia

Exclusive Content

Financing

Red Lobster gives private equity another black eye

The Bottom Line: The role a giant sale-leaseback had in the bankruptcy filing of the seafood chain has drawn more criticism of the investment firms' financial engineering. The criticism is well-earned.

Financing

Beverage chains are taking off as consumers shift their drink preferences

The Bottom Line: Some of the fastest-growing chains in the U.S. push drinks, even as sales at traditional concepts lag in growing delivery and takeout business. How can traditional restaurants get in on the action?

Financing

Brands need to think creatively as the industry heads into a value war

The Bottom Line: Giving customers meal options they can afford will be key to generating traffic this year. But make sure those offers can generate a profit.

Trending

More from our partners