Jan. 12--Nestle USA is closing its customer service center in Breinigsville, a decision that affects 72 employees and comes as the company aims to boost efficiency in a competitive industry.
Nestle USA, the company behind products such as Coffee-Mate and Nesquik, informed the state this week via a Worker Adjustment and Retraining Notification Act filing that the employee separations will be complete by the end of March.
While the state was told this week, Nestle spokesman Josh Morton said the Nestle Way center's employees were informed in February 2018 that the company was making changes to its business customer service organization and planned to create a single team supporting Nestle USA in Solon, Ohio. Employees were offered the opportunity to apply for roles in Solon, he noted.
Since that internal announcement, Morton said about 20 employees in Breinigsville have either left the company or relocated. Fifty-two employees remain, slated to lose their jobs in about two months.
"Nestle has been transforming our business to improve the way the company works so that we become more agile, efficient and innovative in an increasingly competitive marketplace," Morton said. "This includes simplifying, standardizing and sharing work across many functions in the company."
Nestle SA, the Swiss parent of Nestle USA, Nestle Waters and Nestle Purina, has been under pressure by investors, including Daniel Loeb, founder of hedge fund Third Point Management, to cut costs and boost profitability at a time when customers pivot away from traditional packaged foods.
Aside from changing up its customer service organization, Nestle last year announced plans to reorganize its information technology team in Switzerland and also decided to put its skin health unit up for sale, a business the company said doesn't fit in its sharpened focus on food, beverage and nutritional products.
In October, Nestle reported a nine-month sales increase of 2 percent with an operating profit margin improvement consistent with its 2020 target. Nestle CEO Mark Schneider said the company saw improved momentum in North America, where it reported growth in Purina products, Coffee-Mate creamers and coffee.
Some of those products move through Nestle's roughly 1-million-square-foot distribution center at 555 Nestle Way, also the building where the soon-to-be-closed customer service center operates.
The distribution center, which Morton called a key hub for Nestle in the region, is unaffected by the announcement. But the closure of the customer service center will eliminate about one-quarter of the building's employment.
Morton said more than 210 people currently work in the building, including the 52 remaining customer service employees.
The distribution center, which supports Nestle USA and its sister companies, Nestle Waters and Nestle Purina, will have about 160 employees once the customer service center closes, Morton noted.
Elsewhere in the Lehigh Valley, Nestle Waters employs more than 600 people across two bottling facilities in Breinigsville. Meanwhile, Nestle Purina has about 480 employees at its site in South Whitehall Township.
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