Why PepsiCo Is Laying Off Hundreds Of US Employees
Nothing says happy holidays like laying off a bunch of workers in December. PepsiCo has been making headlines of late, both for introducing new and unusual flavors, as well as for the way the company is navigating the challenges of the current economic climate. PepsiCo recently introduced its new, limited-release Nutmeg Pepsi, a nod to the flashy soccer move of dribbling a soccer ball between the legs of your opponent. And according to The Street, which ran an article titled "Pepsi Keeps Making New Flavors Nobody Asked for," the carbonated drink maker has also launched s'mores-themed flavors of chocolate, graham crackers, and marshmallows.
It was in October of 2022 that PepsiCo's CFO, Hugh Johnston told investor analysts he was confident that PepsiCo consumers would remain loyal to the brand even if additional price increases became necessary for the company to weather economic pressure, per Food Navigator. As it turns out, price increases aren't the only response PepsiCo has had to the current period of economic difficulty.
PepsiCo plans to eliminate hundreds of American jobs
In a memo sent to PepsiCo staff, viewed by the Wall Street Journal, the company announced its intention to lay off hundreds of workers based at its North American headquarters. The locations are based in Purchase, New York, for the beverage business and in Chicago and Plano, Texas, for the snack food portion of the company. The reason the memo articulated for the layoffs is "to simplify the organization so we can operate more efficiently."
The publication notes that the layoff announcement follows an October 2022 announcement of a "jump in quarterly sales and profits" that PepsiCo intended to celebrate by "cutting costs to offset the pressure on profit margins and to weather what appeared to be worsening macroeconomic conditions." PepsiCo's layoffs aren't the only sign that food and beverage businesses are struggling to navigate challenging economic waters. In the last half of 2022, Beyond Meat, Walmart, and DoorDash have all announced layoff plans as well.