RACINE — SC Johnson is about to embark on six months of planning to restructure the company worldwide. The actions, yet to be determined, are expected to cut positions around the world including an estimated 100 to 200 Racine area jobs.
SCJ Chairman and CEO Fisk Johnson announced his intentions midday Thursday in a town hall-style meeting held at Fortaleza Hall on the headquarters campus at 1525 Howe St., said company spokeswoman Kelly Semrau. His talk included a question-and-answer session and was webcast to SCJ facilities around the world.
“The restructuring will be global,” Semrau said. “There will be jobs in Racine that will be lost.”
A loss of 100 jobs would be about one in 35, or about 3 percent, of SCJ’s approximately 3,500 Racine-area employees. A loss of 200 would be about two in 35, or a little less than 6 percent.
No worldwide target is available yet for position reductions, SCJ spokeswoman Jam Stewart said.
Planning for restructuring commences now and will wind up in about April, Semrau said. The actions themselves will take place over the course of the company’s next fiscal year which starts July 1, 2014.
“The (job cuts) won’t be like a big bang,” Semrau said.
“It’ll be over the business cycle. ... So it might take like a year for some of those folks to leave the company.”
No production jobs at Waxdale will be lost, she said — though Semrau could not rule out other types of positions there being reduced.
“Fisk has said no area is immune. It’s probably going to be from every function.”
Semrau said those who lose their jobs will be treated with “dignity, respect and generosity.”
Semrau said restructuring is designed to better position SCJ against the other four giants in the consumer products industry: Procter & Gamble, Unilever, Clorox and Reckitt Benckiser.
“We’ve come off of five years of record sales and profits,” she said, and the company’s last fiscal year which ended June 30 was its best ever for sales and profits.
Despite that, she explained, “We’re restructuring because the industry we operate in moves quickly, evolves quickly.”
“There are two ways to do what we do: You invent the brand or you buy a brand,” Semrau said. “... But sometimes acquiring is faster and better because people already know about it.
“So when you look at acquisitions in our space, they’re few and far between because they’ve all been gobbled up,” she continued. “... So you have to be ready to grab something when it comes up.”
But with acquisition opportunities being scant and the main competitors being very large, the laws of supply and demand make the prices of brands much more expensive than in the past, Semrau said. So, making SCJ even more profitable means the ability to set aside more cash for future acquisitions.
Layoffs and restructuring actions in the Racine area are not unprecedented, Semrau said. “I do think people misinterpret that if you go to SCJ, it’s lifetime employment,” she said. “We’ve had (layoffs). We’re a normal business.”
“People have a fairly long runway, and they have a fairly long runway to understand what’s going to happen to them,” Semrau said. “The downside of that long runway is the uncertainty.”
She added, “You either give somebody a pink slip and two weeks — that seems awful in our point of view, or you get people to help you in the planning.”
Semrau said the restructuring will be an opportunity for future growth and adding more Racine jobs later.