Warren Buffett is just one of the notable investors who lost money in shares in Kraft Heinz, a 3G firm, last year
Capital, an investment fund, but it controls some of the planet’s best-known brands, including Heinz, Budweiser and Burger King. In the business worldhas become widely admired for buying venerable firms and using debt and surgical cost-cuts to boost their financial returns. But after Kraft Heinz, afirm, revealed a $12.6bn quarterly loss on February 21st what appeared to be a successful strategy suddenly looks like a fiasco.-run firms owe at least $150bn .
Cost-cutting is essential in mature industries. The process of reallocating labour and capital away from declining products and towards new ones, as well as to new firms, is what boosts productivity. Nonetheless, managers have to get the mix right between slashing expenses and investing for growth, while maintaining an appropriate level of debt. Kraft Heinz has failed on both counts.
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