Dive Brief:
- In a move the industry has anticipated, The Kraft Heinz Co. is eliminating approximately 2,500 jobs — of the combined groups' 46,600 — following the merger between Kraft Foods Group and The H.J. Heinz Company.
- Approximately 700 of the jobs are at Kraft's headquarters in Northfield, IL — that's about 35% of the about 2,000 peopleworkingthere.
- The industry saw this coming, considering 3G Capital, which worked with Warren Buffett's Berkshire Hathaway to form this company, has a history of cost cuts, including those at Heinz.
Dive Insight:
Bloombergreportedjob cuts at Kraft late last month, in addition to no longer providing an employee perk: free snacks.
The signs have been telling: Kraftexecutiveswere replaced before the merger's completion, but most revealing was moving the headquarters to a significantly smaller space, from 700,000 square feet in Northfield to 170,000 square feet in Chicago's city center.
In light of 3G's history, cost-cutting tactics are far from over.
Meanwhile, individualearningsfor each company announced Monday after market close suggest potential challenges for the merged company, not to mention forebodingbrand shedding, according toKelly O’Keefe, a branding expert and professor at Virginia Commonwealth University.
Also, says Buffett, a Mondelezacquisition— or that of another large food company — is not likely right now.
