Thu. Nov 21st, 2019

This is why Parmalat is gearing up to cut hundreds of jobs

parmalat retrenchmentsThe dairy manufacturer says it was left with no choice.

this is why parmalat is gearing up to cut hundreds of jobs 1024x499 - This is why Parmalat is gearing up to cut hundreds of jobs

367f7cdc parmalat 1200x585 - This is why Parmalat is gearing up to cut hundreds of jobs

Parmalat has confirmed that it will begin restructuring its distribution model, a move that threatens the jobs many workers.

As reported by Sowetan Live, the manufacturing company would not be swayed into revealing the exact number of workers whose jobs are on the line.

However, they did mention that this was a necessary change to save the business.

Why is Parmalat retrenching staff?

Parmalat had warned of this day back in January. Coming into a new financial year, the production company’s profit margins were thinning and decisions had to be made.

Minimising output by letting go of factory workers and other staff at their plants would only hurt them. So, the company revealed that as of May, it would implement a new distribution model.

This involved partially outsourcing elements of its distribution network to a third-party provider.

The cited publication indicated that in Polokwane, Nelspruit, Upington and George, Parmalat has already handed over its distribution service to an unknown third-party agent.

The company also revealed that in exchange, the distribution services used in Centurion, Cape Town, Durban, Port Elizabeth and East London would be returned to Parmalat.

“To minimise business risk, Parmalat SA has opted to, for now, return all the distribution services from distribution centre’s back to Parmalat, and to continue with the outsourcing of the rest of its distribution network in accordance with the new operating model that has already been implemented,” the company said in a statement.

How many jobs will be lost?

Parmalat indicated that there is a likelihood that this restructuring will result in job casualties in its distribution sector in Polokwane, Nelspruit, Upington and George.

However, when probed about the exact figure, the company would not budge. The producer of dairy products joins a lengthy list of companies in South Africa that have begun the process of shedding its workforce to stay afloat.

Leave a Reply

Your email address will not be published. Required fields are marked *