Danish meat producer Danish Crown has announced several new cost-saving measures, including the transfer of some departments from Denmark to Poland and the cancellation of a new head office.

The group announced in 2016 that it would aim to reduce procurement costs by DKK 500 million ($76.4 million) before the end of the 2020/21 financial year, and this target has now been raised to DKK 650 million ($99.3 million).

As part of this strategy, the company will combine a number of its administrative departments over the next few years, which will operate from a new Global Business Services centre in Poland.

The first step of this process is the relocation of approximately 50 positions from Randers, Denmark to Krakow, Poland. Danish Crown estimates that the transfer will generate annual savings of approximately DKK 40 million ($6.1 million) once completed.

As a result of the new measures, Danish Crown has also suspended the construction of a planned joint office in Randers, which would have been shared by Danish Crown and its Tulip Food Company subsidiary.

Danish Crown’s group CEO Jais Valeur said: “We continuously review our strategy, and in three specific areas we have decided to strengthen our efforts as we believe this will benefit the group in both the short and the long term.

“However, these are not easy decisions to make as it means saying goodbye to a number of employees in different parts of the organisation.

“At the same time, we are postponing the construction of our new head office, which will no doubt be a disappointment for our employees in Randers.

“The situation is that the difference between the cost of producing a pig and the price at which it can be sold is being pressured by the low pig prices.

“As a result, we do not feel that this is the right time to go ahead with this project. Having Danish Crown and Tulip Food Company move in together still makes a lot of sense, but it will not happen at the beginning of 2020 as originally planned.”