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HP Sauce Switch Leads to Job Losses

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HP Sauce Switch Leads to Job Losses tutor2u businesscafé supporting teachers:: inspiring students HP Sauce Switch Leads to Job Losses After a proud history of over 100 years in the UK, the production of HP Sauce is being transfered to Holland. In a pickle Lea & Perrins was first served to passengers on ocean liners in 1837. US food manufacturer, Heinz, has announced its decision to close its UK-based HP Foods factory with HP Foods was also responsible for producing a the loss of 125 jobs. number of sauces, including Daddies and Amoy Asian sauces. HP Sauce and Lea & Perrins are currently The closure of the factory, based in Aston, exported to 75 countries worldwide. Birmingham, comes as a result of a bid for greater efficiency and productivity. The Corporate greed? factory will be shut down in March 2007, with production of HP Sauce Heinz has claimed that the Aston transferred to the Netherlands. factory is no longer financially The bottling of another of the viable and that it had examined company’s brands, Lea and Perrins all of the possible options before Worcestershire Sauce, will move to taking the decision to close it. The the company’s Worcester site. company’s vice-president, David Hobin, commented: Heinz bought HP Foods from French group Danone in 2005 for £470m, “It is disappointing that we allegedly beating rivals Premier have not been able to find an Foods and Associated British Foods alternative option that would to acquire the company’s brands. close the financial gap”, praising Danone had purchased HP Foods the factory’s employees for their from Hanson for £199m in 1998. hard work and dedication through what he described as “challenging Commenting on the initial times”. investment in June 2005, Heinz president and chief executive Heinz estimates that the switch in William Johnson confirmed that The production of HP Sauce in production to its European sauces the acquisition was: Holland is expected to generate centre in Elst will lead to savings of substantial cost savings for Heinz over £25m in the next ten years. “consistent with our strategy ttoo drive growth in our profitable and Unions have been campaigning expanding core condiments and sauces category“ and against the closure of the plant for some months. “…underscores our commitment to become a faster- The Transport and General Workers’ Union (T&G), growing, more focussed company”. representing workers at the plant, expressed its disappointment at the decision. Heinz claimed, at the time, to have identified a number of opportunities for expanding sales of its John Jordan, acting national secretary for the T&G, acquired brands by targeting European markets reacting to the announcement, said: and growing consumer tastes for “newer, piquant “There’s no need for the factory to close….It’s a case flavours”. pure and simple of corporate greed. Birmingham is a “Historic global brands” highly profitable site and this move is to bail out the factory in Holland.” Originally invented and manufactured by a The union is now calling for a boycott of HP products Nottingham grocer in 1903, HP Sauce has been manufactured outside the UK. manufactured at the Birmingham factory for over 100 years, and was said to be a favourite of the former British Labour Prime Minister, Harold Wilson. Sources: BBC News © Tutor2u Limited 2006 www.tutor2u.net/cafe/default.php.
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