Walgreens to cut 1,000 positions
DEERFIELD, Ill. Following through on an aggressive plan to cut its operating costs by $1 billion a year within the next three years, Walgreens revealed today it will reduce its corporate staff and field management by approximately 9% by the end of this fiscal year in August. The work reduction plan will eliminate some 1,000 management jobs through a combination of voluntary and involuntary layoffs in fiscal 2009.
The cuts will not reach into the ranks of hourly store-level employees, Walgreens said. Nevertheless, the work reductions mark a striking departure from Walgreens’ traditional growth-oriented posture and a grim reflection of a downward-spiraling economy. They also bear out predictions made by company leaders in October, when interim chairman Alan McNally unveiled a massive transformation and cost-reduction effort aimed at bringing Walgreens’ operating costs into line with new economic realities and rejuvenating the company’s brand and customer appeal in a difficult marketplace.
Walgreens president and CEO Greg Wasson said that wherever possible the workforce cuts would come through voluntary retirement and resignation programs for affected employees. To reduce overhead, including the number of people employed in corporate and support roles, Walgreens said it is enabling eligible employees to voluntarily resign or retire with both severance pay and benefits coverage based on years of service and retirement eligibility. The program is being offered in advance of a supplemental “involuntary” separation program that will begin in February.
“We are committed to reducing our corporate and support staff level fairly and with respect for all of our employees, which is why we’re first offering a voluntary separation program,” he said. “We’ve succeeded for more than a century by changing as the economy, our industry and the marketplace change and have always adjusted to keep our company strong and growing.”
The staff cuts are in line with what McNally dubbed Walgreens’ “Rewiring for Growth” initiative, one of several strategic projects aimed at reducing costs and leveraging the value of the company’s core businesses. The overhaul, first announced at Walgreens’ Analyst Day meeting in October, “will align the company’s cost, culture and capabilities to enhance customer service and satisfaction levels for shoppers, patients and payers,” the company noted.
General Mills donates to charity and advertises through NBC’s ‘Biggest Loser’
GOLDEN VALLEY, Minn. Major food manufacturer General Mills is backing NBC’s hit show “Biggest Loser” with its first-ever advertising slot for the show’s seventh season, which started Tuesday night. The spot will be viewed by approximately 8.6 million viewers, and fall 2008 showed a 2% rise in adult viewers ages 18 to 49, a demographic that advertisers often like to target. Nine other marketers from the show’s December season will also be advertising.
General Mills is also sponsoring a “Pound for Pound Challenge” in which the Cheerios and Progresso soup maker will be contributing 10 cents to Feeding America for every pound of weight loss pledged at biggestloser.com.
“This is our first integrated partnership of this kind,” said John Haugen, General Mills’ vice president of health and wellness. “We’re looking for a positive impact on all of our brands.”
Though popular (“Biggest Loser” averaged 8.9 million viewers last January), the show will be rivaling Fox’s incredibly successful “American Idol,” which begins next week and also airs Tuesday nights. Idol can bring in an audience of up to 25 million.
Adventrx faces further workforce cuts
SAN DIEGO After laying off 55 percent of its workforce, Adventrx is planning further reductions in its employees to extend its remaining cash reserves, the company announced Monday.
The company said that in the end, it will have 14 employees. It has also reduced and delayed spending on third-party consulting and vendor services, including contract manufacturing.
The remaining employees will evaluate options for the future and continue the company?s study of the drug candidate ANX-514 (docetaxel emulsion) and submitting an approval application for the candidate ANX-530 (vinorelbine emulsion).
“It’s never easy to let go employees, particularly those who have been with the company for many years and who have made contributions to the company,” Adventrx board chairman Jack Lief said in a statement.