Pernod moves forward with cost-cutting plan

Pernod Ricard’s cost-cutting plan has advanced as the company reveals it is considering a reorganisation of its French distribution units – a move that could lead to around 60 job losses.

Pernod Ricard is considering cost-cutting plans at two distribution units in France which could lead to a number of redundancies

According to Reuters, the French drinks group, which owns The Glenlivet whisky and Absolut vodka brands, is working on a plan to save funds at its two separate distribution units, called Pernod and Ricard.

The plans are part of a wider cost-cutting strategy – called Project Allegro – which Pernod Ricard hopes will save over 150 million euros over the next three years.

Executives claim that the project has been designed to allow greater “operational efficiency” through “simplifying, prioritising and mutualising” Pernod’s global business.

Allegro was revealed as the group announced its half-year financial results, where global sales declined 7%.

Pierre Pringuet, CEO of Pernod Ricard, also admitted in the same month that redundancies would be a likely part of the project, adding that “how many is absolutely premature to answer”.

Of this recent announcement of streamlining operations in France, a spokesperson for Pernod Ricard told Reuters: “In France what is being considered is sharing support functions such as IT, finances, human resources or purchasing between the Pernod and Ricard distribution units.”

“The plan does not affect Ricard or Pernod plants while Pernod and Ricard remain separate legal entities with their dedicated commercial and marketing teams.”

The company is consulting unions over the plans, which involve regrouping of functions spread between the Pernod and Ricard distribution units, where a total of 156 people are employed.

Further details on Project Allegro will be announced at the end of August when Pernod Ricard details its full-year financial results.