Nestle layoffs: FMCG giant plans to slash 16,000 jobs days after new CEO takes charge—details here

Nestle Layoffs: Nestlé SA is planning to slash 16,000 jobs just weeks after new Chief Executive Officer Philipp Navratil took charge at the foodmaking giant and vowed to accelerate a turnaround for the company.

The job cuts amount to around 6 per cent of Nestle's workforce.

“The world is changing, and Nestle needs to change faster,” Navratil said in a statement on Thursday.

“This will include making hard but necessary decisions to reduce headcount.”

Nestle layoffs: When will it happen?

Nestle, which makes Nespresso coffee capsules and KitKat candy bars, said on Thursday that the layoffs will happen over a period of two years.

Who will be laid off?

The Nestle layoffs will be conducted globally, which means some employees from every country Nestle operates in are likely to be affected.

The layoffs include 12,000 white-collar jobs, on top of 4,000 job cuts already underway in production and the supply chain.

Nestle CEO sets ambitious target

Nestle said that the layoffs will save the foodmaking giant 1 billion Swiss francs, which the company said was double what had been previously planned.

Navatril's shocker came as the company published nine-month figures showing sales down by 1.9% to 65.9 billion Swiss francs ($83 billion).

The stronger-than-expected rise in sales were driven by higher prices and improved real internal growth — a key measure of volumes closely watched by analysts and investors.

Nestle shares are indicated 3.4% higher at Julius Baer in premarket trading. The foodmaker has risen 1.7% this year, lagging behind the 8% increase in the Swiss Market Index.

The layoffs also come after Nestle suffered an internal turmoil earlier this year, despite the company being known for its staid corporate culture, shaking up the upper management.

Navratil took over as Nestle CEO in September as the Swiss company dismissed Laurent Freixe over his alleged affair with a subordinate at the office.

Philipp Navratil started his career with Nestlé in 2001 and has decades of experience in the company.

Since he took over, Navratil has indicated that he well maintain Freixe’s strategy of boosting spending on advertising, betting on fewer but bigger product initiatives and getting rid of underperforming units.

On a call with reporters Thursday, he identified Nestlé’s top priority as further increasing real internal growth, and added the company is evaluating everything in its portfolio.