Coca-Cola cuts 2,200 jobs and restructures

The saying, new year, new you has a whole new meaning for the soda corporation Coca-Cola that is reducing its workforce by 2,200 people in an effort to restructure and respond to ripple effects from the pandemic. Layoffs and buyouts in the U.S. will constitute the majority of the job reductions with the company planning on reducing its workforce by 12% of 1,200 jobs.

In 2019, Coca-Cola had just over 86,000 employees, but over the last two years, the Atlanta-based company has worked to scale back its number of employees and brands in an effort to revitalize and streamline its business.

"The pandemic was not a cause for these changes, but it has been a catalyst for the company to move faster," the company said in a statement.

Last August, Coke said that it would offer buyouts to 4,000 employees in North America and Puerto Rico. Additionally, the job cuts would be followed by a reduction in business units from 17 to nine in an effort to eliminate redundancies and speed up efficiencies. However, despite the planned reductions in staff, the company has been hit particularly hard by the pandemic. The BBC reported that about half of Coke's volume sales come from out of home venues such as stadiums and movie theaters, but with the majority of those public gathering spaces closed over the course of the pandemic, it has eaten away at the company’s margins. This past quarter, Coca-Cola requoted a 9% decline in revenue from last year to $8.65 billion.

Brands that have built up the company’s portfolio are also on the chopping block. Already recent months have seen Tab soda, Zico coconut water and Odwalla juices retired. However, this is only the beginning of the planned retirement of 200 brands globally. Worldwide, the soda giant has 430 master brands.

At the same time that the company is reducing its number of employees and portfolio size, it is steadily investing in modern brands that are trendy and fast-growing. Recently, Coca-Cola launched its first energy drink, assumed the remaining stake in Fairlife milk and purchased in-demand beverage brands, including Topo Chico and Costa Coffee.

These continued aggressive moves to reposition the 128-year-old company as a relevant option for today’s consumers whose tastes are continually evolving will likely help the soda titan find firmer financial footing as it works to reset itself following the ramifications of the pandemic.