On Wednesday Molson Coors President and CEO Gavin Hattersley laid out a sweeping corporate restructuring and revitalization plan aimed at putting it on the path to growth.
This is the second time in 13 months that the company has been consolidating things in an effort to become more profitable. And with the company’s profits continuing to decline, we it expect it won’t be the last.
A couple of takeaways from the Hattersley’s announcement…
Company Name Change an Admission of Beers Waning Dominance
Even though Hattersley maintains that Molson Coors “makes some of the world’s greatest beers… iconic beers have stood the test of time,” Molson Coors net sales fell 3.2% in Q3 and it’s clear that the company isn’t betting entirely segment for its future.
As part of the restructuring, Hattersley, announced that effective January 2020, Molson Coors Brewing Co. will change its name to Molson Coors Beverage Co., an admission that to survive the company needed to move into alternative beverages like the growing hard seltzer segment.
Molson Coors to Consolidate and Downsizing Its Workforce
As part of an effort to “streamline the company” Hattersley plans to axe between 400 and 500 jobs as part of a wider restructuring of the business.
Molson Coors will also close its Denver office, and move its headquarters to Chicago. According to the Drinks Business “the company has roughly 17,750 employees worldwide, 7,300 of whom are in the US,” and hopes to save $150 million with the headquarters move.
And although the company has not disclosed where its extensive layoffs will occur, we’ve got think that Colorado could be Ground Zero.
Big Beer is in Big Trouble
Actually everybody in the brewing industry should be on full alert…And craft beer we’re including you as well.
Beer’s once unassailable supremacy is waning as Millennial’s and Gen Xer’s migrate away from beer to wine, spirits and/or pot….or move on to a healthier lifestyle and abandon intoxicants altogether.
Coming off weaker-than-expected third quarter earnings report AB in Bev, home to Budweiser, Corona and Stella Artois, recently saw $13 billion in market value wiped out in one day.
Companies like Molson Coors are navigating increasingly turbulent waters. And Hattersley, who has only been in the CEO role for three months, is hoping that this move to a more streamlined and nimble operation, one that focuses on beverages vs. brewing, will help him avoid potentially devastating icebergs.
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