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Joint Plan will Ensure Competitiveness

by 5m Editor
6 May 2009, at 11:56am

DENMARK - Massive savings, structural changes and a new settlement concept are the cornerstones of a new proposal from meat processing giant Danish Crown which, over the next 6-12 months, will ensure the group’s competitiveness and supplies of raw materials.

"At the moment, the biggest threat to the company’s competitiveness is falling supplies of raw materials. The joint plan therefore includes both massive cost cuts and a new and more up-to-date settlement concept for the company’s owners. The two things are inextricably related, because our competitiveness depends on supplies being adequate," said Kjeld Johannesen, CEO of Danish Crown.

At the meeting of the Board of Representatives in Herning today, Danish Crown’s Executive Management presented the plan, which in a short space of time will both improve conditions for pig producers and safeguard Danish jobs.

The plan also includes a marked call for action on the part of politicians as well as setting out requirements in terms of developments in Danish pay costs.

“The very high payroll costs is a decisive factor when it comes to our competitiveness as an international business in Denmark. It is therefore an absolute demand that together with our employees we must reduce payroll costs by 20 per cent.

"This will require a fresh approach on the part of both parties,” said Mr Johannesen.

With the joint plan, Danish Crown is also sending a clear signal to politicians that framework conditions need to be changed if heavy export businesses such as food production companies are to remain in Denmark.

“The latest pig count means that, within the next few weeks, we will once again be announcing redundancies in Denmark. This is not a tenable situation, and it is this we are now trying to turn round through huge efforts in the company, but it will not happen without everyone’s support,” said Mr Johannesen.