Chicago-based MillerCoors will eliminate 350 salaried jobs across the company, including 200 currently occupied positions, according to a post on the MillerCoors’ Behind the Beer blog.
Gavin Hattersley, MillerCoors chief executive officer, announced the restructuring plan in an email to staff and distributors. The restructuring is the first since 2013, according to the post.
“We are moving quickly and decisively to get our business back on track,” Hattersley wrote in the email.“To accomplish this, we know we need the financial flexibility to invest in our brands and solutions at the right level, quickly capitalize on new opportunities, and maintain a robust marketplace presence. Our current fixed cost base limits our ability to do all this.”
The blog post described the move “as a recognition that the company’s organization and cost base are now out of line with the scale of its business and increasing costs.”
MillerCoors saw volumes decline by 5.5 percent in the first six months of the year or around 1.6 million barrels. Gross profits were down even more at 8.5 percent. In August, Hattersley said the performance was partially the result of factors outside the company’s control but was also self-inflicted, particularly with poor rollout of a new system at its Golden, Colorado brewery.
The company had pushed since 2015 to halt sales declines in 2018 and return to growth in 2019. Hattersley said that assumed flat performance for the industry, which hasn’t happened.
“While we know we still have some challenges ahead,” Hattersley said in his email, “we’re establishing a realistic, achievable plan for 2019 to put us on the path to long-term sustainable growth.”
The blog post did not specify where the job cuts would come from, other than noting 150 of the positions were “held open or were cut earlier this year.” The company is also offering a voluntary severance program as part of the restructuring.
“We’re committed to handling this restructuring with speed, dignity and respect for all involved and without marketplace disruption,” Hattersley wrote.
The company’s Milwaukee operations have seen significant investment in recent years with a $50 million expansion of the Tenth Street brewery along Interstate 43 and the creation of a new business center in Milwaukee by parent company Molson Coors. The new center included 150 jobs with 85 employees transferring from MillerCoors to the parent company and 65 new hires.
MillerCoors spokesman Marty Maloney said it is too early to say how the cuts will impact Milwaukee operations.
