Kellogg to Lay Off More than 200

Sept. 9, 2021
Kellogg Co. has announced plans to lay off more than 200 employees at Battle Creek, Mich., its headquarters.

Kellogg Co. has announced plans to lay off more than 200 employees at its plant in Battle Creek, Mich., the site of its corporate headquarters.

The 174 full-time and 38 salaried positions will disappear by the end of 2023, according to a notice that Kellogg gave its union employees on Sept. 3. It’s not clear how the layoffs will break down between corporate headquarters and a cereal production plant in Battle Creek.

Kellogg cast this as a necessary move to bring efficiencies to its supply chain.

"In our ongoing analysis of our RTEC [ready-to-eat cereal] network, it's clear that some locations are more cost-effective and better performing than others,” a company spokesperson told the Battle Creek Enquirer.

"After very careful consideration and detailed analysis, we have presented a planned reallocation of cereal production across our RTEC [ready-to-eat cereal] Americas network," said Kellogg spokesperson Kris Bahner. "If these plans are finalized, they will deliver significant savings that could be reinvested into the business to drive growth and help to regain share. These plans build on the streamlining efforts announced in 2017, some of which were previously completed."

The layoffs are presumably part of a $45 million comprehensive project to make Kellogg’s supply chain more efficient.

In a Sept. 3 filing with the Securities and Exchange Commission, Kellogg refers to “a reorganization plan for the North America supply chain network, designed to drive increased productivity.” Few details were given, except that “No production facilities are expected to be closed as a result of this plan, which instead involves shifting production of various products to optimal lines across the Americas network.”

Kellogg has experienced problems in filling orders for ready-to-eat cereal, sales of which boomed during the pandemic as consumers returned to eating at home. Company officials recently attributed this to difficulty in finding labor, especially truck drivers.

The SEC filing breaks down the $45 million expenditure as $25 million in cash and $20 million in “accelerated depreciation and asset write-offs.” Of the cash portion, $4 million will go toward “severance and other termination benefits.”

Kellogg cut 223 jobs in Battle Creek in 2018 and 67 more in 2019, according to the Enquirer.

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