Adidas announces radical job cuts: 500 jobs at risk!

Adidas announces radical job cuts: 500 jobs at risk!

In Herzogenaurach, Germany, Adidas plans to cut up to 500 jobs. CEO Björn Gulden said on Wednesday that the decision was necessary to reduce internal complexity. “We need to cut up to 500 positions because those positions – not the people – create complexity,” he said. These dismantling plans are not new: they were already leaked in January and have now been officially confirmed. To remain competitive in today's fast-moving market landscape, fewer centralized decisions are required, Gulden clarified. According to the company boss's assessment, it is no longer possible to control from Germany what sells well in the USA or China, for example.

The current developments come at a time when Adidas is also making positive growth forecasts. A ten percent increase in sales is expected for the current year, but without income from Yeezy products, which are no longer taken into account due to the termination of the collaboration with the controversial rapper Kanye West. Last year, Adidas generated around 650 million euros from these products, and overall sales rose by twelve percent after adjusting for currency effects to 23.7 billion euros. This resulted in a profit of 824 million euros, following a loss of 58 million euros the year before, according to the Small newspaper reported.

Optimization of marketing strategy

To further increase profitability, Adidas plans to increase operating profit to 1.7 to 1.8 billion euros, up from 1.3 billion last year. In addition, spending on marketing and sales is to be increased in order to expand the market position. The challenges caused by job cuts are reflected in the need to break your own rules in order to create simpler structures. This was also done by Krone.at confirmed, and represents a fundamental change in the company's management style.