Human Capital & Careers

Bite Size: Hershey Cuts 1,500 Jobs

Pennsylvania-based chocolate maker will retain most production volume in the United States and Canada but plans a facility for Mexico as well.
Stephen TaubFebruary 15, 2007

Hershey is the latest large company to announce sizable job cuts.

The Pennsylvania-based chocolate maker will eliminate 1,500 positions over the next three years as part of “a comprehensive, three-year supply chain transformation program.” In a statement, the company added that “when completed, this program will greatly enhance Hershey’s manufacturing, sourcing and customer service capabilities, and will generate significant resources to invest in the company’s growth initiatives.”

Hershey will reduce the number of production lines by more than one-third, outsource production of “low value-added items,” and construct “a flexible, cost-effective production facility” in Monterrey, Mexico. The company maintained that 80 percent of production volume will continue to reside in the United States and Canada.

“In order for Hershey to remain competitive, we are implementing a comprehensive strategic agenda focused on increasing our North American marketplace leadership and developing a truly global footprint for Hershey’s iconic brands,” said chairman, president, and chief executive officer Richard H. Lenny, in a statement.

Earlier this week:

• DaimlerChrysler announced that it would cut 13,000 jobs at its North American operations over the next two years.
• Coca-Cola Enterprises announced reductions of 3,500 positions, or about 5 percent of its work force, during restructuring of its corporate, North American, and European operations. “In North America, we will create a highly efficient supply chain and order fulfillment structure, and improve customer service by implementing new selling systems for many of our customers,” the company elaborated.
• Viacom’s MTV Networks unit will cut about 250 jobs, roughly 6 percent of its work force, according to the Associated Press. Judy McGrath, MTV’s chief executive officer, reportedly stated that the company would “refine our business and organizational models”; cuts will also cost the jobs of several senior-level executives, according to The Hollywood Reporter.