Rich Products will shift work from four back-office departments to India from its Niagara Street headquarters and elsewhere in its global operations, starting in the fourth quarter.
The privately held food products company said it has not yet determined how many jobs will be affected among the more than 700 people who work at headquarters. But the plans represent a notable strategic shift. Rich Products said the changes are aimed at cutting costs and making its operations more efficient as the company invests heavily in technology.
A spokesman, Dwight Gram, said the company remains committed to Buffalo, and that there will be an undetermined number of opportunities for employees who are affected to shift into other roles.
“We expect there is going to be some impact around the world and in Buffalo,” Gram said. “We just don’t know the extent of that impact yet.”
The changes will involve work in finance, supply chain, information technology and human resources. Gram said Buffalo will be among the locations – but not the only one – affected by the shift. And he said some work related to each of those four areas will remain in Buffalo after the shift, a process expected to take two years to complete.
Rich Products already has an enterprise technology center set up in India – staffed by its own employees – where IT work will be shifted, Gram said.
Work related to finance, supply chain and human resources will be shifted to an enterprise service organization that Rich Products will establish in India. Rich Products will partner with a third-party company for that work, Gram said.
“We wanted to go where the experts are, and this is where they’re located,” he said. “They do this for many companies across the world.” Rich Products has not yet selected that partner.
Rich Products has about 13,000 employees worldwide, in more than 100 countries. India is one of Rich Products’ fastest-growing markets, and is home to three of its manufacturing facilities, Gram said.
“It’s a really solid organizational infrastructure we can build on, as well,” he said.
Gram described the work being shifted to India as “time intensive, in many cases highly repetitive.”
He said Rich Products will aim to place impacted employees in other positions the company has deliberately left open, and in new positions expected to be created as other work is shifted to Buffalo.
“There’s going to be a lot of new roles created in all these different areas,” Gram said.
Rich Products is one of Buffalo’s most prominent private employers. The company ranked No. 117 on Forbes’ list of America’s largest private companies published last December, and its senior chairman, Robert Rich Jr., is No. 527 on Forbes’ list of the richest people in the world, with net worth of $5.2 billion.
Rich Products generates about $5 billion in annual revenues and says it is on track to reach its goal of $6 billion by 2025.
Gram said Rich Products has invested nearly $50 million in new technology over the past three years to “digitally power our business,” and is planning to invest another $190 million over the next four years. Moving some of its work overseas will help Rich Products optimize those investments, and cut down on duplication of effort among operations around the world, he said.
“The savings we derive from this will be reinvested back in our business, to fuel some of our growth platforms,” Gram said. The shift will also free up other employees to concentrate on work related to serving customers, he said.
Rich Products has changed the nature of its operations in the Buffalo area over the years.
The company phased out the last of its local manufacturing operations over a decade ago, shifting that work to sites in other parts of the country. Rich Products is investing over $100 million to expand a food manufacturing and distribution facility in Brownsville, Texas, according to local media reports.
Meanwhile, the company has focused on operations such as research and development at its Buffalo headquarters.
In spite of the upcoming shift of work to India, Gram said the Rich family and company executives “are 100% committed to remaining a strong presence in Buffalo. The moves we’re making now are going to set us up to be well positioned in the future.”
And he noted the headquarters also has a number of functions – including research and development, sales and marketing, legal, communications and food safety – in addition to the four areas impacted by work shifting to India. Buffalo is also the home base for Rich Products’ U.S.-Canada operations.
The company has added 35 jobs at the Buffalo headquarters over the past three years, and recently invested about $5 million in its office technology and workplace at the Niagara Street campus, to support its hybrid work approach, Gram said.
Gram said the Rich family’s mandate centers on two points: “They want our company to remain a private, family owned business, and they want us to be successful over the long term.”