Oreo-Maker Mondelez Plans to Kill One of Every Four Products
The effort doesn’t necessarily mean any brands will be eliminated. Instead, Mondelez is targeting individual product varieties.
(Bloomberg) -- Snack-food giant Mondelez International Inc. plans to eliminate a quarter of its products to streamline manufacturing during the pandemic.
“That’s always a discussion in a company like ours, that we have too many flavors, too many sizes and so on,” Chief Executive Dirk Van De Put said Friday in an interview on Bloomberg Television. “This is the moment to drive that.”
The effort doesn’t necessarily mean any brands will be eliminated. Instead, the maker of Oreo cookies and Ritz crackers is targeting individual product varieties, known as stock-keeping units or SKUs. He didn’t specify which items could be on the chopping block.
Packaged-food manufacturers have seen demand soar during the coronavirus pandemic as stuck-at-home consumers stock up their pantries. But the situation has exposed the challenges of maintaining such an expansive product mix.
Mondelez isn’t alone in slimming its product lineup, a process known as “SKU rationalization” that cuts down on inventory and packaging costs, and eases logistics for online ordering. General Mills Inc. is trimming its soup offerings by nearly half.
Mondelez has seen a particular spike in demand for comfort foods like chocolate and cookies, Van De Put said. He pointed to Nutter Butters as one product consumers want right now, while on-the-go products like gum are taking a hit.
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