Several days ago it was announced that Coca-Cola plans to layout 2,200 workers from the company. 1,200 are in the United States.
In the United States, Coca-Cola employed about 10,400 at the end of 2019. These cuts represent 12% of its workforce. At its Atlanta, Georgia headquarters, 500 workers are expected to be eliminated.
The reductions include voluntary and involuntary separations, and the severance packages are expected to cost the company between $350 million and $550 million.
The company announced plans to trim its workforce over the summer, when it said that it was offering buyouts to 4,000 workers in the United States, Canada and Puerto Rico.
Coca-Cola also said they planned to reduce their 17 operating units in four regions down to 9, but they did not say where.
In the third quarter, the company’s sales dipped 9% to $8.7 billion.
AUTHOR COMMENTARY
The WinePress had reported that Coca-Cola is also cutting 200 brands from its portfolio, which included major brands such as Powerade and Dasani. This is a particular point I have emphasized when discussing the economy’s condition, and for good reason. If you asked random people on the street to name 10 of the most globally recognizable brands, Coca-Cola would be one of them. If one of the most globally recognizable brands is doing that to its international company, then how does this translate to an economy that is improving, or is in a “v-shaped recovery?”
Coke’s sales are down so much because the restaurants and bars have suffered some of the worst damage because of the Draconian lockdowns and regulations these businesses must follow in order to try and survive. This is also includes places like theaters and other attractions and venues. Most people do not go to restaurants purely for the food, they also good for the experience and ambience. When that is taken away, told to wear masks (and have germy staff cook and serve the food with masks and gloves), socially distanced, limited capacity, etc, the experience is gone. Not to mention that people are strapped for cash and are not willing to spend it on things that they do not need, or they just do not have it all together – factoring inflation of the dollar and the price of goods going up.
This is one of the many reasons why Congress felt the need to give bailout money to the theaters in order to save that industry. But as we pointed out in that report, that will not fix the problem, especially when many of these places still shutdown or have too many restrictions on them. The new trend many movie companies are doing is they are now making their movies and programs veiwable via streaming services; so theaters will continue to die off regardless – but this explains why Coke’s sales are down so much.
I will keep saying it so everyone gets the message who has not got it yet: there is no “v-shaped recovery!”
The WinePress needs your support! If God has laid it on your heart to want to contribute, please prayerfully consider donating to this ministry. If you cannot gift a monetary donation, then please donate your fervent prayers to keep this ministry going! Thank you and may God bless you.
