Kraft Heinz to split international arm into three divisions to unlock growth 

UNITED STATES – Kraft Heinz, an American multinational food company has announced a significant restructuring plan that will see the division of its international operations into three distinct units in a move to drive faster growth. 

The proposed structure will have three entities; Kraft Heinz International North America, Kraft Heinz International Europe, and Kraft Heinz International Asia-Pacific and Latin America. 

The Heinz and Velveeta brand owner makes the strategic move to optimize efficiency, enhance market-specific focus, and ultimately drive growth and innovation across the global markets. 

For instance, Kraft Heinz Asia-Pacific and Latin America will concentrate on expanding Kraft Heinz’s presence in the Asia-Pacific and Latin American markets, tapping into the potential for growth and innovation in the dynamic regions. 

The new structure will also provide an opportunity for each unit to make region-specific investments, product development, and marketing strategies.  

It is anticipated that this will help Kraft Heinz better compete in each market, build stronger relationships with local partners, and drive innovation to meet the evolving tastes and preferences of consumers. 

Miguel Patricio, CEO of the Kraft Heinz Company said, “Our decision to split our international arm into three distinct units reflects our commitment to customization and customer-centricity. 

 We believe this will enhance our ability to respond to local market needs and consumer preferences, enabling us to bring our beloved products closer to consumers worldwide.” 

The proposed structure comes as part of Kraft Heinz’s broader effort to adapt to changing consumer preferences and market dynamics.  

Through separation into three entities, the company aims to better address the unique demands and opportunities within various regions ultimately ensuring a more agile and competitive presence on the global market. 

Q3 2023 Report 

Meanwhile, Kraft Heinz reported a 5% volume drop in the third quarter of 2023 but still managed to achieve a 1% sales growth. The company’s gross profit margin increased 568 basis points to 34.0%, with a 1.7% increase in organic net sales. 

“We laid out a series of action plans at the beginning of the year to drive market share and volume improvement, and I’m pleased to say we saw improvement throughout the quarter as our team executed these plans. We will remain focused on our overall strategy to drive top-line profitable growth,” said Miguel. 

Currently, the company is working on improving volume and market share, especially in the meats business where net sales in North America slipped 0.4% in the third quarter that ended September 30.