Swiss food giant Nestlé has announced plans to cut 16,000 jobs globally over the next two years, with the majority—12,000 positions—being white-collar roles. This aggressive cost-saving initiative aims to save the company one billion Swiss francs and is part of CEO Philipp Navratil’s efforts to accelerate transformation amid slowing growth and declining sales. Nestlé previously planned fewer cuts but has now increased its savings target to three billion Swiss francs by 2027, signaling a major push to streamline operations and improve profitability.
Cost-Cutting Measures and Layoffs
The planned elimination of 16,000 jobs includes 4,000 reductions in production and supply chain areas, reflecting Nestlé’s focus on operational efficiency and automation. Navratil emphasized the need for making “hard but necessary decisions” to reduce headcount as part of adapting to a changing global market landscape. This move follows recent leadership changes, with the previous CEO dismissed amid internal issues and the chairman stepping down early.
Financial Performance and Market Pressures
Nestlé’s nine-month financial results reveal sales declined by 1.9% to 65.9 billion Swiss francs ($83 billion), even though organic sales rose by 3.3%, driven primarily by price increases. The multinational owns over 2,000 brands, including Nestlé, Kit Kat, Nespresso, and Purina. However, the company has faced significant challenges, including a bottled water scandal originating in France in 2024, which added pressure on its reputation and business stability.
Navigating Transformation and Future Outlook
CEO Philipp Navratil is aiming at fostering a culture of performance and faster change within Nestlé. The restructuring, cost cuts, and efficiency improvements are designed to position the company for sustainable growth in a competitive market environment shaped by evolving consumer preferences and economic uncertainties. This strategic transformation aligns with broader industry trends toward digitalization and supply chain modernization.
