Kuoni launches major business restructure

Pan-European tour operating group Kuoni has launched a major shake-up of its business in a move that has resulted in the departure of one of its senior board members.

The restructure will deliver “substantial” savings and forms part of the group’s cost-cutting programme announced at the start of this year. This aims to save 40 million Swiss francs by 2012.

But a “difference of opinion” over the new strategy has led to the departure of Reto Wilhelm, head of strategic business for the Style division and a member of the group’s executive board.

The changes, aimed at increasing the group’s customer focus, include the creation of two destination-based north and south regions to replace the product-based Style and Smart divisions. The UK features in the north division. The Destinations division remains in place.

The Style brand, for the group’s premium and specialist holidays, and Smart, its package holidays brand, will still be used internally to differentiate between products.

The group is also creating a single procurement and production unit across its north and south divisions to act as a global buying team. Previously these functions were dealt with by each country separately. For example, brochure pricing and printing will still be carried out in the local markets but products, text and pictures will be sourced centrally.

The group would not comment on how many jobs could be lost as a result of the changes, but a spokeswoman said: “There will be probably be more jobs in sales and less in production but the numbers have yet to be determined.”

As of next month the board structure will change, with Leif Vase Larsen and Stefan Leser heading up the north and south regions, and Rolf Schafroth, also head of the Destinations division, leading the new procurement and production unit. Also on the board are chief executive Peter Rothwell and chief financial officer Max E.Katz.

In a statement, the group said the shake-up was the first fundamental restructure for decades and would change the group from a decentralised to a functional organisation. It should be completed by mid-2010.

Rothwell said: “This new organisation, which focuses on marketing and sales on the one hand and procurement and production on the other, will provide us with more customer focus, further growth opportunities, improved profitability and efficient cost management.”

More information:

* Kuoni posts loss, forecasts profit but warns on flu (Travel Weekly, August 21, 2009)

* Kuoni reveals locations for up to five new shops (Travel Weekly, July 16, 2009)

* ‘Kuoni’s new shops could help agents’: interview with Derek Jones (Travel Weekly, July 16, 2009)

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