Heinz to consolidate European purchasing operation

27 May 2011

27 May 2011 | Angeline Albert

HJ Heinz Company is to centralise its procurement operations and establish a European supply chain hub in The Netherlands.

The group’s motivation for creating the hub is to drive innovation, improve speed and quality in the supply chain, increase the expertise of the procurement function and harness its buying power more effectively.

A spokesman for the ketchup and baked beans manufacturer told SM this would lead to an increase in the number of buying roles, as it hires more staff as part of its supply chain improvement plans.

Heinz’s strategic sourcing activities will be based in Zeist at its European headquarters, but buyers will continue to work locally around the world to support local offices, factories and suppliers, as well as making trips to the hub. The group’s European sourcing operation has about 75 buyers for direct and indirect materials.

Peter Boterman, a spokesman for Heinz, said: “We are adding several global sourcing roles to the mix to leverage our global buying power. We have implemented several global category leader roles to enable Heinz to develop global strategies for key commodity areas that leverage our scale and drive productivity through the supply chain.”

“Improving our cost management is an overall objective for the years ahead and the sourcing management team will drive this with enhanced sourcing capabilities.”

The creation of the hub will start in June and is expected to be completed in the second half of 2012.

Manufacturing, logistics and inventory control will also be centralised at the hub. As well as the location for Heinz’ European HQ, Zeist has been chosen for its proximity to the company’s European ketchup factory and research centre.

The fact Heinz plans to hire more supply chain staff contrasts with the group’s overall plan to reduce the global workforce by 800 jobs, announced in the company’s financial results this week. The firm plans to close five factories, but also to invest $160 million (£97.4 million) in improving manufacturing efficiency.

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