According to a Wall Street Journal (WSJ) report, PepsiCo Inc. HQ is laying off employees from its North American snack and beverage units, signaling that the cost-cutting practices have extended beyond tech and media companies.
A person with knowledge of the matter told the WSJ that hundreds of jobs would be lost. Employees at the company’s headquarters in Purchase, New York, and its snacks and packaged-food business with headquarters in Chicago and Plano, Texas, are reportedly being laid off.
“This is being done to simplify the organization so that we can work more efficiently”, the company said in a memo to its employees.
Even though it is paying more for commodities like sugar, corn and potatoes and passing those higher prices on to consumers, the maker of Frito-Lay chips, Mountain Dew soft drinks and Quaker Oats cereal has said its products Demand remains strong.
“The overall US labor market is historically tight, with employers competing for a limited pool of labor and raising wages despite an uncertain economic outlook,” the report said.
In October, FMCG company executives said they would focus on cutting costs to relieve pressure from low profit margins. Along with many other companies, it has increased the price of its products.
PepsiCo makes Doritos, Lay’s Chips and Quaker Oats alongside its Pepsi Cola drink. It employs around 309,000 people worldwide. Along with this it has joined Walmart and Ford Motors in reducing their workforce.
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