This story was originally published on Food Dive. To receive daily news and insights, subscribe to our free daily Food Dive newsletter. Higher costs and slowing consumer spending are setting up a challenging 2026 for food manufacturers, leaving them with little choice but to downsize, cut prices, or rethink their approach to innovation to remain relevant. The gloomy outlook for the new year comes after a bruising 2025 pushed many food and beverage companies to cut jobs, close manufacturing plants or sell ...

Core Insights - Nestlé's new CEO Philipp Navratil is implementing significant changes, including a workforce reduction of 16,000 jobs, which represents 6% of its global workforce [1][4][6] - The company aims to achieve cost savings of $3.79 billion by 2027, indicating a strategic shift towards efficiency and resource allocation [3][9] Company Actions - The job cuts will include approximately 12,000 white-collar roles and 4,000 positions in manufacturing and supply chain [4] - The workforce reduction is part of a broader strategy to enhance performance and shareholder value, with a focus on prioritizing high-potential opportunities [9] Financial Performance - Nestlé reported a strong third quarter with organic sales growth of 4.3%, up from an average of 2.9% in the first half of the year [7] - However, sales in the Americas declined by 0.4%, despite a pricing increase of 2.9% [7] Sales Distribution - North America accounts for 35% of Nestlé's sales, amounting to $40.5 billion, followed by Europe at 24% ($27.88 billion), Asia, Oceania, and Africa at 21% ($24.23 billion), Latin America at 14% ($15.9 billion), and Greater China at 6% ($6.81 billion) [5][8]

Core Insights - Nestlé is undergoing significant operational changes to enhance efficiency and agility, with a focus on automation for faster decision-making [3][4] - The company plans to cut 16,000 jobs, representing about 6% of its global workforce of 277,000, as part of its cost-reduction strategy [7] - Newly appointed CEO Philipp Navratil aims to continue the restructuring efforts initiated by his predecessor, increasing the cost savings target to 3 billion Swiss francs ($3.8 billion) by the end of 2027 [7] Job Cuts and Workforce Changes - The job cuts will include 12,000 corporate positions and 4,000 from manufacturing and supply chain staffing reductions [4] - Navratil emphasized the need for a performance-driven culture, stating that talent assessment will be ruthless, focusing on key performance indicators [5] Leadership and Strategic Direction - Navratil, who became CEO in September, is the third CEO in just over a year, following the dismissal of Laurent Freixe due to personal misconduct [6] - Freixe's strategy focused on increasing advertising and marketing to boost sales, but the company is now shifting towards a more streamlined approach under Navratil [6]