Dive Brief:
- International Paper will close a container facility in Buena Park, California, affecting 71 employees, according to a worker adjustment and retraining notification filed with the state.
- The company “made the difficult decision to cease production at Buena Park” by August 2, said Amy Simpson, head of corporate communications and marketing, via email. The company “completed a strategic assessment of the region and decided the capacity of this facility could be incorporated into other nearby facilities without customer interruption.”
- IP will assist both the affected employees and customers through the transition, Simpson said. Employees are eligible to apply for jobs posted at other company facilities.
Dive Insight:
This closure in California is the latest in a series that International Paper has undertaken over the last year as part of its streamlining efforts. Since October 2024, the company’s announced consolidations have impacted roughly 2,500 employees across the United States, inclusive of the Buena Park additions.
CEO Andy Silvernail announced shortly after he joined IP in May 2024 that the company would embark on an optimization plan, which he refers to as 80/20, that involves significant cost cutting. The strategy is based on the Pareto principle that 80% of outcomes occur from 20% of efforts.
IP has also started implementing the 80/20 plan internationally following the acquisition of London-based DS Smith in January. In May, the company disclosed plans to close five packaging sites in the United Kingdom, with an estimated 300 employees affected there.
Silvernail has said in recent earnings calls that the 80/20 strategy is working, prompting cost cuts in addition to resulting in productivity gains. The company has also announced strategic investments in its box manufacturing network, such as launching a greenfield box plant in Waterloo, Iowa, expected to start up mid-2026. It also plans to expand a container plant in McAllen, Texas, which IP expects will create 40 new jobs.
International Paper will report its Q2 earnings on July 31.
