Goodman Fielder to cut bakeries

Australian bakery Goodman Fielder has revealed plans to shut around 27 bakeries through closures and divestments over the next three years.

The closures – part of Goodman Fielder’s three year A$100 million cost reduction programme - will be mostly in the firm’s bakery division. However, the company said that the closures will not necessarily result in job losses.

''This is not necessarily about jobs going. It's about having fewer but bigger and better bakeries,'' said Martin Cole, Goodman Fielder’s spokesman.

Around 18 bakeries in Australia and 9 in New Zealand have been earmarked for closure. Goodman Fielder will also reduce its product range and distribution network.

The company said that it will increase its marketing spend by 90% in an attempt to drive sales.

Last week, Goodman Fielder sold its Integro oils business to Graincorp for A$170 million and the firm expects to conclude a deal to offload its New Zealand milling business shortly.

In August, Goodman Fielder announced that it had leaked A$146.9 million during 2011-12 – a marginal improvement on the A$166.7 loss for the previous financial year. The firm has already shed 600 jobs in a bid to revive its business which has been hit by higher costs and intense competition from supermarket brands.