InBev, the Belgian compnay that bought Anheuser-Busch last fall, has been slashing costs, cutting jobs and rethinking the way the company sells beer, according to a story in the Wall Street Journal.
Construction crews have demolished the ornate executive suites at Anheuser-Busch Cos. headquarters, replacing them with a sea of desks where executives and others work a few feet apart, according to a story in the Wall Street Journal.
The story, written by David Kesmodel and Suzanne Vranica, says it’s just part of a sweeping makeover that has turned the family-led company that spared little expense into one that is focused on cost-cutting and profit margins.
InBev, the Belgian company that bought Anheuser-Busch last fall, has cut jobs, revamped the compensation system and dropped perks that had made the Anheuser-Busch employees the envy of others in St. Louis, the story says. Managers accustomed to flying first class or on company planes now fly coach and freebees like tickets to the St. Louis Cardinals games are now scarce.
Suppliers have also taken a hit. Anheuser-Busch InBev NV has told barley merchants, ad agencies other vendors that it wants to take up to 120 days to pay bills. The company has also eliminated some sports deals that were central to marketing at the old Anheuser-Busch.
Workers are frustrated with the changes, and the story says that the tumult could offer an opening for MillerCoors LLC, which has been exhorting its employees to exploit the transition by trying to grab more shelf space at large retailers.
Anheuser-Busch has nearly half of the U.S. beer market, while the newly merged MillerCoors has 29% of the market, the story says.
Anheuser-Busch recently told NBC it will spend about 50% less on its coming Olympics ad package, which includes next year’s Vancouver Winter Games and the 2012 Games in London, than it spent on its previous Olympics package. Nor will the brewer seek to be the exclusive beer advertiser on NBC’s broadcasts of the Vancouver or London games, the story says, and MillerCoors is seeking to get into the Olympics telecasts. Anheuser-Busch is also reducing significantly the number of new ads created for it each year from 100 to about 50 or 60.
WSJ Online subscribers may read the full story here.