The restructuring was announced recently by P&G Chief Financial Officer Andre Schulten at the Deutsche Bank Consumer Conference.
Here’s what to know about the plan.
Restructuring will be drawn out
In its announcement, P&G said it expects to reduce up to 7,000 non-manufacturing roles, or approximately 15% of its current non-manufacturing workforce, over the next two years.
“Plans will be implemented over the next two fiscal years, allowing us appropriately sequence the delivery of important innovation and operational projects,” the company said in a statement. “As we do this, our top priority remains delivering balanced growth and value creation to delight consumers, customers, employees, society and shareowners alike.”
P&G employs thousands of local employees
Beyond its Cincinnati headquarters, Procter & Gamble has a 1.8 million-square-foot distribution center in Union, one of the first distribution operations located near the Dayton International Airport that heralded that area’s role as a hotbed of logistics work.
That site has hundreds of employees today.
The company’s Mason Research Center is thought to have more than 2,800 people. It has been said to be the company’s largest research and development center.
As of early Monday, there were no state WARN (Worker Adjustment Retraining Notice) notices to the Ohio Department of Job and Family Services regarding either site.
P&G has about 108,000 employees worldwide. A message seeking comment was left with a company spokesman.
Credit: Lisa Powell
Credit: Lisa Powell
The local P&G distribution center sold for $93M in 2019
ILPT Properties LLC purchased the P&G distribution center on Union Airpark Boulevard from ARCP ID Union OH, the limited liability company that owned the property since 2014, for more than $93 million in the spring of 2019.
“There is no impact on P&G’s business because of this sale,” a P&G spokesman at the time told the Dayton Daily News. “Recall we are merely tenants at the site, and have been since construction.”
Montgomery County property records list Industrial Logistics Properties Trust as the site’s most recent owner.
Geopolitical instability may have played a role in the restructuring decision
While the company’s recent announcement does not mention recent American tariffs that could make global supply chains more expensive, it does refer to an “unpredictable ... geopolitical environment.” .
“Technology is rapidly transforming nearly every aspect of daily life. At the same time, we can unlock significant growth by better meeting the needs of currently unserved and under-served consumers, expanding into new segments, and growing markets to best-in-class levels,” P&G said.
The company’s supply chain is indeed worldwide.
“One of the things we learned (during COVID) was that when one market shut down, we could continue to operate because we had supply based around the world,” Fares Sayegh, a P&G supply chain senior vice president, told Supply Chain Management Review in 2023
The company appears to be growing steadily
P&G’s latest fiscal year represented six straight years of 4% or better organic sales growth, or growth excluding acquisitions, the business said.
Fiscal year 2024 was P&G’s eighth consecutive year of 2% or better core EPS (earnings per share) growth, averaging nearly 8% over that period.
Shares of P&G (NYSE: PG) were trending up late last week after the layoffs were announced, trading around $164 per share. The stock’s range over the past year has been $156.58 to $180.43.
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