Global dairy cooperative, FrieslandCampina has confirmed that it intends to lower costs by reducing over 1,800 jobs worldwide over the next two years.
1,200 of these jobs will be cut in 2024 across the organisation which operates across 30 countries.
FrieslandCampina previously announced that it aims to achieve annual gross cost savings of €400-500 million from 2026 onwards of which €180-200 million is attributed to the job reductions announced this week.
The cost savings are part of ‘Expedition 2030’, a strategy aimed at strengthening the company’s position as a sustainable player in the dairy industry.
Global dairy
FrieslandCampina said part of the annual savings will be needed to off-set inflation.
The remaining margin expansion will be equally divided between investing in sustainable growth and increasing the company’s net profit, it has said.
To realise the savings, one-off costs of up to €170 million euro will be booked in 2023, according to the global dairy co-op.
All proposed decisions are subject to Central Works Council advice and local laws and regulations.
Jan Derck van Karnebeek, CEO of Royal FrieslandCampina said: “Today is a tough day for FrieslandCampina.
“Over the past period, we have analysed the cost structure of our organisation and we are now announcing difficult but necessary steps to structurally reduce our costs.
“We realise that the announcement of job losses will have a big impact on the people involved. We will therefore do our utmost to inform and assist everyone as best as possible during this difficult time.
“These cost savings should contribute to FrieslandCampina’s ability to compete and win in the market for the benefit of our employees and member dairy farmers,” he added.
Members
Due to the disappointing financial results in 2023 and the one-off costs, the dairy co-op has also announced that no supplementary cash payment will be made to member dairy farmers over 2023.
The company supplies consumer products, such as milk, yogurt, cheese, infant nutrition, desserts, products for the professional market, such as cream and butter products, ingredients and semi-finished products for producers of infant nutrition, the food industry and the pharmaceutical sector.
There are branches in 30 countries and it exports to more than 100 countries worldwide.
It has 9,927 member dairy farms and 15,137 member dairy farmers in the Netherlands, Belgium and Germany.
Some of its brands include Yazoo and Chocomel.