South Korea: Heineken Korea to lay off up to 8% of total workforce amid restructure

Heineken Korea is restructuring its workforce. This is due to increased competition from other imported beer brands, the Chosun Daily reported on February 15.

According to the alcohol industry on Feb. 15, Heineken Korea, the Korean corporate body of global brewer Heineken, recently decided to restructure its workforce. As part of this restructuring, the company is planning to layoff around 7 to 8 % of its total workforce. All employees, except for certain key salespeople, are expected to be affected by the layoffs.

Heineken Korea notified its employees of the layoffs, citing cost-cutting due to poor performance. Some key employees have begun discussing career move agreements with competitors. The restructuring was reportedly led by the new head of Heineken Korea, Michael Vainio, who was appointed in August last year.

“We are currently in the process of reorganizing the Heineken Korea organization,” the company said. “The business environment has changed rapidly over the course of 2022 and 2023, and the consumption patterns of alcoholic beverages have changed significantly,” the company said, adding that the decision was made to keep pace and improve the organization’s competitiveness.

Heineken is the world’s second-largest brewer, headquartered in the Netherlands. Founded in 1864, it currently employs more than 86,000 people in over 70 countries. The domestic organization employs about 160 people.

Heineken ranked first in the domestic imported beer market for two consecutive years from 2020 to 2021, at the height of the pandemic.

However, it lost the top spot to Chinese beers, including Tsingtao, in 2022. Last year, it lost ground to Japanese beer, led by Asahi draft canned beer.

As a result, its net profit plunged 55% from $21 million (28.8 billion won) in 2019 to $1.29 million (12.9 billion won) in 2022. The industry estimates that Heineken’s profit last year was likely even lower than that of 2022, given the cut throat competition in the imported beer industry.

15 February, 2024