Procter & Gamble (P&G), one of the largest consumer goods companies in the world, has announced that it would eliminate 7,000 jobs over the next two years, representing around 6% of its global workforce.
Job cuts represent 15% of its uncompromising workforce and are part of a wider cost reduction strategy aimed at protecting margins as tariff pressures and low -global demand on operations.
The changes were disclosed during a presentation at the global conference of Deutsche Bank consumers in Paris, where P&G managers described a strategic change to leave certain brands, categories and product formats on certain markets.
This decision reflects a more aggressive approach to simplify operations, reallocate resources and adapt its global portfolio to a volatile economic climate.
The uncertainty of the trade war puts pressure on prices and planning
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The P&G decision to reduce the workforce comes in the context of an prolonged trade war directed by the United States, which has triggered tariff increases on the main inputs and finished goods.
The protectionist measures of the American president Donald Trump led to broader disturbances between the world supply chains, increasing cost charges for companies like P&G.
The leaders noted that the company is undergoing “unequal demand” while consumers react with caution in the face of an increase in inflation and economic uncertainty.
Earlier this year, P&G increased prices on a range of consumer products, including household staples such as Pampers and Tide, to compensate for the inflation of input costs.
The financial director Andre Schulten and the chief of operation Shailesh Jejurikar said that the external environment remains very unpredictable, the prices acting as a key engine of volatility.
They added that the new strategy is not a gap in past practices but rather an acceleration of the current transformation plan to strengthen resilience.
Organizational restructuring to stimulate productivity and profitability
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P&G reported 108,000 employees on June 30, 2024.
Although the company has not provided geographic or functional breakdowns of the next layoffs, he said that reductions will largely affect non -manufacturing functions such as marketing, administration and product development.
The leaders said that the restructuring would extend existing roles and reduce the size of the teams. This is intended to flatten the p&G hierarchy, accelerate decision -making and simplify its supply chain.
The company also plans to exceed certain brands and rationalize its range of products on the markets where performance has been disappointed.
Job reductions and brand outputs are part of a productivity renewed accent to maintain a competitive advantage in a low growth and higher cost environment.
P&G said that the plan aims to unlock operational savings that will be reinvested in brand innovation and consumer value delivery.
P&G signals of continuous price increases in the middle of the defense strategy on the margin
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The April price increases have been described as one of the many tools available for P&G, because it seeks to defend profitability.
The company warned that more hikes may be necessary if prices persist or degenerate.
Managers said P&G is ready to use “each lever” to protect your income, including prices, cost savings and portfolio optimization.
The company did not specify the financial impact of the restructuring, but analysts expect ad hoc costs linked to the dismissal and the reduction of assets to follow in the next quarters.
The announcement positions P&G as the last multinational to respond decisively to the pressure pressures induced by prices.
Several other consumer goods companies have reported similar concerns in recent months, which indicates that the effects of global trade frictions continue to slow down in the industry.
