One of the most significant issues that Danone has faced is declining sales in its key markets. The company’s dairy division, which accounts for over half of its revenue, has struggled in recent years due to changing consumer preferences and increased competition. The company has also faced challenges in its bottled water division, with declining demand for single-use plastics and concerns about the environmental impact of bottled water.
Moreover, Danone has faced controversy over its management decisions. In 2020, the company announced plans to cut 2,000 jobs and streamline its operations, which led to criticism from employee unions and activist groups. The company’s former CEO, Emmanuel Faber, was also accused of mismanaging the company and failing to address its strategic challenges, leading to his departure in 2021.
In addition, Danone has faced criticism over its sustainability practices. While the company has set ambitious targets to reduce its carbon footprint and improve its environmental impact, it has faced scrutiny over its use of palm oil and its impact on deforestation in Southeast Asia.
Danone has taken some measures to address these issues, such as launching a new sustainability plan and appointing a new CEO, Antoine de Saint-Affrique, who has promised to overhaul the company’s strategy and prioritize sustainability. The company has also pledged to become a B Corporation, a certification for companies that meet high environmental and social standards.
However, these measures may not be enough to restore Danone’s reputation fully. The company’s declining sales, controversial management decisions, and sustainability issues have all had a negative impact on its brand and could take years to repair.
In conclusion, Danone has faced several negative issues concerning its strategic missteps, including declining sales, controversial management decisions, and sustainability issues. While the company has taken steps to address these issues, it remains to be seen if these measures will be enough to restore its reputation and regain the trust of customers and investors. Danone’s strategic missteps remain a significant challenge for the company and will require significant effort and investment to overcome.