Dutch dairy company FrieslandCampina has announced it will shut its Gütersloh plant in Germany, affecting 231 employees.
The move is part of a ‘comprehensive reorientation’ of the company’s German unit as it invests in its core brands such as Landliebe, Tuffi and Frico.
FrieslandCampina said the closing of the site is a consequence of overcapacities in the highly fragmented German market and years of loss-making production of private label desserts that make up the major part of the Gütersloh volumes.
This category will be discontinued, while other product lines will be transferred to the plants in Cologne, Heilbronn and Maasdam.
The planned closure of production in Gütersloh is scheduled for March 2019, with the company saying it will have a ‘negligible’ impact.
FrieslandCampina Germany managing director Jan Kruise said: “This was a tough decision to make, but previous attempts to fix the problems have failed and after careful consideration of alternative solutions the continued loss-making situation, unfortunately, has left us no other choice.
“We will of course very shortly enter into consultation with the employee representatives and we will do everything that is within our power to help the affected employees find new jobs elsewhere.”
The company will also relocate its commercial functions to the Düsseldorf area as it aims to ‘benefit from the strong talent base in the area and to drive the Germany strategy more effectively’.
The transfer is scheduled for the second quarter of 2018. Employees have been informed about the plans today. The plants in Heilbronn, Cologne and Schefflenz as well as their workforce, numbering 366, 326 and 23 respectively, will not be affected by the intended move.
Kruise added: “The German market for dairy products is fragmented and characterised by fierce competition due to overcapacities. We are convinced we will be able to master these challenges by focusing on our strong brands and through strictly consumer-oriented management of our product portfolio.
“We are the only company with a substantial presence in all dairy categories and channels, and we will benefit from this competitive advantage by proving ourselves a preferred partner in the market in accordance with our strategy. In order to achieve our ambitious goals we will invest in our business and we will not shy away from difficult decisions that will open up the path to a successful future for the long term. We are here to stay.”
Last week FrieslandCampina appointed Jaska de Bakker as chief financial officer, succeeding Hein Schumacher, who was appointed chief executive officer in September.
© FoodBev Media Ltd 2018