The management structure at British American Tobacco (BATS) will soon look much slimmer. The tobacco company is planning to cut 2,300 roles globally by January 2020, with around a fifth of the senior roles in the company to be affected. Chief executive Jack Bowles said the aim is to “make BAT a stronger, simpler and faster organisation”, with a continued focus on growth in new categories such as vapours and tobacco heating products.
This suggests that BAT will be using the money it will save by simplifying its management structure to invest more heavily in the new category products. The half-year results in August heralded a “significant increase in investment in new categories”. Mr Bowles reiterated the target of generating £5bn of revenues from new categories by 2023/23. There’s a great deal of work to be done to hit this target. It had previously revised down its new categories sales generation target for 2018 from £1bn to £900m, and narrowly beat this at £901m. The £5bn sales target has initially been scheduled for 2022.
