Diageo Supply Chain Overhaul Aims for £60m Annual Saving
Diageo, the world’s biggest spirits group whose brands include Smirnoff vodka and Johnnie Walker whisky, said it is reviewing its global supply and procurement operation with the aim of reducing costs by £60m annually.
The group said that the operation would be refocused to enhance alignment between global supply and its 21 key markets, with responsibility for local operations to be transferred to the markets and regional structures reduced. Costs associated with the restructure are estimated to be around £100m, with the £60m per annum savings expected to be achieved within three years.
Diageo added that the move is a “consequence of [its] increasing presence in new faster growth markets”, with a target of generating nearly half of its total revenue from these markets close to being reached.