Bemis Company Is Laying Off 300 Employees
Bemis Company, Inc., a global manufacturer of packaging solutions, has announced that the company will be cutting 300 positions and closing two factories.
The company is restructuring in order to trim its costs. The affected employees will primarily include those employed in administrative positions. The layoffs will result in cutting the company’s global administrative workforce by five percent. The job cuts will take place over a period of three years.
In addition, the company is also moving the work from two of its manufacturing plants to other locations. One plant is expected to close this year, while the other will likely close in 2018. The employees who currently work at these two facilities may also move to the new plants.
Bemis Company’s Cost-Cutting Plans
According to the company’s CEO, William Austen, Bemis Company plans to cut its costs by about $55.0 million to $60.0 million. The job cuts and factory closures will help the company in achieving part of its cost-savings goal.
The layoffs are expected to save the company roughly $20.0 million within the next three years. Likewise, the two planned plant closures are expected to deliver nearly $10.0 million in cost savings, once fully implemented.
The company’s profitability should receive a boost once the administrative and manufacturing overhead costs are reduced. Bemis Company expects to achieve between five percent and 10% of the cost savings this year. Another 50% to 60% savings are expected in 2018, while the remaining will likely be achieved in 2019.
The restructuring efforts were undertaken after the company faced challenges within its home market in the United States, as well as in its global markets, primarily Brazil.
“During April, we began a review to align our U.S. manufacturing and administrative cost structures with the demands of our customer base to better position the Company in the current environment and for its long-term success,” said Austen.
He further said, “Given the challenges in the Brazilian economic environment, we also expanded the scope of our review to include our entire global business.”
Bemis is the largest film and sheet maker in North America, generating roughly $2.7 billion in revenue in the region. Globally, the company is estimated to be making about $4.0 billion in corporate sales annually.
“Bemis To Reduce 5% Of Global Administrative Workforce – Quick Facts,” Business Insider, June 30, 2017.
“Bemis Co. to close two plants, cut administrative staff,” Plastics News, June 30, 2017.