Sector News

Heineken South Africa to cut jobs due to alcohol ban impact

January 23, 2021
Food & Drink

Heineken has announced that it will cut 70 jobs and put investments on hold in South Africa, following the impact of alcohol bans amid the Covid-19 pandemic, according to Reuters.

The brewer’s South African arm says there has been significant impact from bans on alcohol sales and Covid-19 trading restrictions. At the end of December, the country banned alcohol sales for the third time to help reduce the pressure on emergency services.

According to Reuters, about 30% of local breweries have been forced to shut their doors permanently and some have abandoned planned investments. Several publications have reported that Heineken marks the first major company to make significant cuts as a result of the alcohol bans.

With just under 1,000 full-time employees at Heineken South Africa, 70 will lose their jobs as the brewer looks to restructure its operations to build a future for the business.

The news comes after Heineken announced in October that it will cut jobs at its head and regional offices in 2021, despite beer volume sales improving in the third quarter, relative to Q2. The South African market had been mentioned within previous financial results with references to poor beer volumes amid lockdown restrictions.

“Prior to considering this action, the company implemented various cost mitigation measures throughout 2020,” said Heineken South Africa human resources director, Yvonne Mosadi, as cited by Reuters.

“Unfortunately, given the ongoing challenging situation the company finds itself in, these measures are no longer adequate to manage and sustain the operating costs of the business.”

Last year, Heineken South African cancelled plans to build a ZAR 6 billion ($403 million) brewery in KwaZulu-Natal after a second ban on alcohol sales was announced.

Reuters reported that Heineken said other new investments will also be placed on hold. The owner of the Amstel and Sol brands will continue to review its cost and organisational structure to meet future needs of the business.

by Emma Upshall

Source: foodbev.com

comments closed

Related News

December 3, 2022

AI central to Nestle’s innovation overhaul

Food & Drink

Nestle SA has accelerated its product development process by 60% since 2016, according to the company. The faster speed to market has been achieved through a restructuring of its research and development process. Now the company is investing in various forms of artificial intelligence (AI) and machine learning to further improve its R&D process and generate better results.

December 3, 2022

Takeover on the horizon? Brenntag makes preliminary indication of interest for Univar Solutions

Food & Drink

German chemicals distributor Brenntag has confirmed potential takeover talks with US rival Univar Solutions and is understood to be debating the feasibility of a potential acquisition in the coming months. Univar Solutions confirms that it has received a preliminary indication of interest from Brenntag regarding a potential transaction.

December 3, 2022

Cargill announces purchase of Owensboro Grain Company

Food & Drink

Cargill has announced the acquisition of Owensboro Grain Company, a soybean processing facility and refinery located in Kentucky. The purchase of the Owensboro-based company will support Cargill’s efforts to “modernise and increase capacity across its North American oilseeds network to support growing demand for oilseeds driven by food, feed and renewable fuel markets”.