Business reorganization and closure of the Froneri ice cream factory

Situation:

One of the market leaders in ice cream sales Froneri used to own a manufacturing factory in the city of Varna, Eastern Bulgaria. In 2018 the company launched business optimization program across its assets in Europe. For Bulgaria, the plan envisaged redirecting investment priorities from production towards sales and marketing of Froneri brands and products. As a result, the factory in Varna had to be closed in the beginning of 2019. This meant the loss of 72 permanent jobs and approximately 100 seasonal positions

Froneri had serious concerns how the news would be taken by the factory staff, the local authorities in Varna and the community. Froneri was as well looking to avoid a possible crisis situation in Bulgaria that can also affect food giant Nestle. The company is a joint venture formed by Nestle and British dairy producer  R&R. In other EU countries announcing plans for the closure of Froneri factories had resulted in protests in front of Nestle headquarters.

Goals:

• Support Froneri in announcing reorganization plans, including the closing of the factory;
• Mitigate communication & reputation risks that may occur with the closing of the factory in Varna;
• Limit possible negative effects from the announcement for Froneri and for Nestle.

Strategy:

• Plan mitigation steps for risks occurring from the announcement of factory closure;
• Announce the restructuring in direct communication to employees stressing on compensations, relocation opportunities, and option for consultations on finding a new job;
• Informing of all stakeholders in Varna and at a national level;
• Focus media communication towards plans for achieving future growth & higher product competitiveness.

Tactics:

• Preliminary preparation & risk mitigation steps:

−plan for informing of the various stakeholders according to a determined schedule and via relevant channels

−crafting of key messages & training of speakers

−preparation of materials – info letters for stakeholders, holding statements in case the news leaks earlier, press release

−follow of environment, traditional & social media, for possible risks

• Meeting with employees to announce factory closure, why it was necessary and options they had for compensations
• Press release to regional & national media focused on plans for future development of Froneri business in Bulgaria and opportunities provided to redundant employees
• Answer to media enquiries
• Direct engagement with key stakeholders – information letters & phone calls to:

−local authorities in Varna & Sofia, business organisations

−suppliers and subcontractors

−partners

Results:

• Total 78 media publications, 65 in national media and 13 in regional media
• 90% of the articles were neutral and presented Froneri messages
• No negative talking in social media and traditional media by Froneri employees or stakeholders
• News met with understanding by key stakeholders, there was no communication crisis
• Only 34% mentioning of Nestle in media publications covering the news