Sara Lee outsources as part of restructuring bid
The US-based company says it will outsource various aspects of these individual divisions as part of moves to speed up its restructuring plan, which aims to create annual savings of between $250m - $300m over the next three years.
A significant part of the cost savings are expected to come from job redundancies, with the company estimating that approximately 700 workers will lose their jobs, a figure that also includes a number of employees in contract roles.
Project Accelerate
“’Project Accelerate’ is designed to improve margins and drive shareholder value as we continue to build the long-term strength of the company,” said Brenda Barnes, chairman and chief executive officer, Sara Lee Corporation.
“In addition to the cost savings, business process outsourcing will help Sara Lee further drive standardization, increase efficiency and provide flexibility.”
The company says that it is still undergoing negotiations with a third party supplier to undertake outsourcing of all the activities and the successful bidder will be announced shortly.
Implementation of the process is expected to take place within the current financial year for the North American market and will be completed within three years.
European business will undergo consultaion procedure
In Europe the time frame for the plans is likely to be dictated by consultations procedures that will abide by European Union regulations, the company stated.
The company, which is currently divided into six business segments that includes household and body care, together with its international bakery division, has a number of major international brands, including Sanex body care, as well as its most global brand, Kiwi shoe polish.
Other brands in the body care division include Radox and Monosavon, together with the hairstyling product Brylcreem and shaving brand Williams.
Sara Lee has seen some challenging business conditions in the past few years. Financial difficulties in 2005 led the company to sell off its direct sales personal care business to Tupperware for $577m, in a move that left it with a hand full of leading personal care brands.
