H.J. Heinz Co.'s "Project Millenia" restructuring plan includes a 30% increase in ad spending over the next two years and the elimination of end-of-quarter trade-loading practices. "This action is designed to fundamentally change the way Heinz goes to market in key U.S. businesses," Heinz said, noting that ditching loss of the trade program will cost it $90 million to $95 million in operating income for the fourth quarter, ending April 30. The jump in ad spending funds a return to TV advertising for Heinz ketchup and added media weight for other products. Ore-Ida's supermarket line, Weight Watchers' diet centers and WW's Smart Ones frozen entrees. Heinz is also lowering Budget Gourmet's price to 99 cents. Under the plan, which Chairman-CEO Anthony O'Reilly claims "will make Heinz one of the three preeminent branded food companies in the world," 2,500 jobs will be eliminated and Ore-Ida's foodservice business will be sold for $500 million to McCain Foods, New Brunswick, Canada.
Copyright March 1997, Crain Communications Inc.