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[August 04, 2014]
P&G: We're sticking with Union center [Dayton Daily News, Ohio :: ]
(Dayton Daily News (OH) Via Acquire Media NewsEdge) Aug. 04--Global consumer giant Procter & Gamble's chief executive has pledged to pull his company away from more than half of its product brands.
The CEO's announcement Friday came as construction continues to complete P&G's 1 million-square-foot distribution center in Union. The center in Union's Global Logistics Airpark is expected to employ 800 workers once it's complete.
A P&G spokesman, Jeff LeRoy, said in an email Monday that he could not discuss which brands will be divested. "We are not discussing specific brand names. We expect the Union, Ohio distribution center to be an important part of P&G's business." It wasn't immediately clear, though, whether a smaller brand/portfolio would mean fewer jobs at the local distribution center. LeRoy said he couldn't answer questions about expected employment or the percentage of P&G's business the to-be-divested portfolio represents.
A spokesman for JobsOhio, the state's private development arm which helped shepherd a deal to bring P&G to Union, said the company's incentives agreement with Ohio -- including the projected jobs number for the center -- remains valid.
"The agreement, including the jobs commitment, remains in place," said Matt Englehart, a JobsOhio spokesman.
John Applegate, Union city manager, said he has not heard anything about how the move will affect jobs in Union.
On Friday, A.G. Lafley, P&G CEO, said the company will sell or end 90 to 100 brands to focus on 70 to 80 brands that do better in the marketplace.
In May, P&G said it will use the $90 million center in Union. Construction on the site began late last year and should be operational in 2015, JobsOhio and others have said.
Steve Wybo, senior managing director with business consultant Conway MacKenzie, said P&G gets about 90 percent of its sales from its biggest brands, household names like Tide, Gillette, Crest and Pampers.
"It's highly unlikely that any of those will be impacted," Wybo said.
A divestiture of more than 50 percent of P&G's brands does not necessarily mean 50 percent of the volume of products going through the distribution center will be affected, he said.
"A warehouse distribution center would only be affected by volume," Wybo said. It may be only a "few percentage points of volume," ultimately affected, he estimated.
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