Unilever Will Exit Ice Cream Business, Cutting 7,500 Jobs

As part of a significant restructuring, Unilever plans to separate from its Ice Cream division. The company’s board believes that Unilever should focus on a portfolio of superior brands with solid positions in attractive categories and complementary operating models. According to a press release, the Ice Cream division has a different operating model. Therefore, the board has decided that separating Ice Cream will best serve future growth.

Separation activity will begin immediately, with complete separation expected by the end of 2025.

Once the separation is complete, Unilever will become a simpler and more focused company, operating four business groups: Beauty & Wellbeing, Personal Care, Home Care, and Nutrition. This move is part of the company’s Growth Action Plan (GAP), announced in October 2023.

The proposed changes are expected to impact around 7,500 predominantly office-based roles globally.

“The Board is determined to transform Unilever into a higher-growth, higher-margin business that will deliver consistently for all stakeholders. Improving our performance and sharpening our portfolio are key to delivering the improved results we believe Unilever can achieve,” said Ian Meakins, Chair of Unilever.

Hein Schumacher, CEO of Unilever said: “Simplifying our portfolio and driving greater productivity will allow us to further unlock the potential of this business, supporting our ambition to position Unilever as a world-leading consumer goods company delivering strong, sustainable growth and enhanced profitability”.

Related Article: Nestlé To Sell its U.S. Ice Cream Business to Froneri for $4 Billion

Separation of Ice Cream

The Unilever Board has expressed confidence that Ice Cream’s future growth potential can be better achieved under a different ownership structure. Ice Cream has unique characteristics compared to Unilever’s other operating businesses, such as a supply chain and point of sale that support frozen goods, a different channel landscape, greater seasonality, and higher capital intensity.

The company boasts five of the world’s top 10 selling ice cream brands, including Wall’s, Magnum, and Ben & Jerry’s. With a global presence, Ice Cream has exposure in both the in-home and out-of-home segments.

The company has stated that Ice Cream is undergoing significant operational changes rapidly, thanks to new leadership. These changes include improved productivity and efficiency measures, product rationalization, and investment in substantial innovations. As a more focused and independent business, Ice Cream’s management team will have greater financial and operational flexibility to grow and allocate capital and resources supporting the company’s specific strategy. This includes improving its manufacturing and logistics network and developing more extensive, flexible distribution channels beyond the current changes underway in the business.