Fresh savings baked in: Sara Lee announces major outsourcing initiative

Sara Lee Corp. will outsource financial transaction processing and indirect procurement activities, a move that will render roughly 700 positions redundant—including positions currently performed by contractors. Annual savings are anticipated to be nearly $250M over the next three years.
By Manufacturing Business Technology Staff December 16, 2008

As part of an overall effort to reap annual savings of $200 million to $250 million over the next three years, Sara Lee Corp . plans to outsource multiple business processes—starting with its North American and European financial transaction processing operations.

The company’s global indirect procurement activities also are expected to be outsourced, as well jobs in the group responsible for developing and maintaining business applications.

In a statement announcing this strategy, the company said these moves would render roughly 700 positions redundant—including positions currently performed by contractors.

Brenda Barnes, chairman and CEO of Sara Lee, said the overall cost-saving effort—known as Project Accelerate—is designed to “improve margins and drive shareholder value as we continue to build the long-term strength of the company. In addition to the cost savings, business process outsourcing will help SaraLee further drive standardization, increase efficiency, and provide flexibility.”

Sara Lee expects to begin implementation of the initiative in North America in the current fiscal year, and plans to complete global implementation within three years. The company is finalizing contract specifics with a third-party supplier that it declined to name.