Dive Brief:
- PepsiCo closed a bottling plant in Knoxville, Tennessee, and laid off 112 workers as the beverage giant charts an aggressive turnaround plan in its flattening soft drinks business.
- The plant closed immediately, though employees will be paid through Jan. 1, according to a PepsiCo statement Monday.
- The plant produced a range of PepsiCo beverages, and employees affected by the closure held positions across manufacturing, maintenance and warehouse services, according to a WARN notice. PepsiCo said it was working to place employees at nearby facilities.
Dive Insight:
PepsiCo has been particularly troubled by its beverage unit. In an earnings call earlier this month, CEO Ramon Laguarta said the company didn’t “feel good” about soft drink performance, adding PepsiCo’s portfolio wasn’t competing well.
Laguarta alluded to cost cuts across the business, saying “everything that is not related to growth will not be part of the company.”
Last quarter, PepsiCo’s volume in North America was down 2%. To combat the declines, the beverage giant is planning to raise prices and boost innovation of its soft drinks, including Mountain Dew, Pepsi and Poppi.
PepsiCo will still operate sales and delivery teams in Knoxville, the company said in the statement.
“We are incredibly thankful for the contributions of our employees and the support of the community,” PepsiCo said.
