PepsiCo Is Laying Off Corporate Employees As the Company Commits To 'Relentlessly Automating' (businessinsider.com) 218
PepsiCo is kicking off a four-year restructuring plan that is expected to cost the company hundreds of millions of dollars in severance pay. "This week, PepsiCo employees in offices including Plano, Texas, and the company's headquarters in Purchase, New York, were alerted that they are being laid off," reports Business Insider, citing two people directly impacted by the layoffs.
The latest job cuts come after CFO Hugh Johnston told CNBC that the company plans to lay off workers in positions that can be automated. CEO Ramon Laguarta said on Friday that PepsiCo is "relentlessly automating and merging the best of our optimized business models with the best new thinking and technologies." From a report: This week, PepsiCo employees in offices including Plano, Texas, and the company's headquarters in Purchase, New York, were alerted that they are being laid off, according to two people who were directly impacted by the layoffs. These two workers were granted anonymity in order to speak frankly without risking professional ramifications. At least some of the workers who were alerted about layoffs will continue to work at PepsiCo until late April as they train their replacements in the coming weeks, the two workers told Business Insider.
By PepsiCo's own estimates, the company's layoffs are expected to be a multimillion-dollar project in 2019. Last Friday, PepsiCo announced in a filing with the Securities and Exchange Commission (SEC) that it is expected to incur $2.5 billion in pretax restructuring costs through 2023, with 70% of charges linked to severance and other employee costs. The company is also planning to close factories, with an additional 15% tied to plant closures and "related actions." Roughly $800 million of the $2.5 billion is expected to impact 2019 results, in addition to the $138 million that was included in 2018 results, the company said in the SEC filing.
The latest job cuts come after CFO Hugh Johnston told CNBC that the company plans to lay off workers in positions that can be automated. CEO Ramon Laguarta said on Friday that PepsiCo is "relentlessly automating and merging the best of our optimized business models with the best new thinking and technologies." From a report: This week, PepsiCo employees in offices including Plano, Texas, and the company's headquarters in Purchase, New York, were alerted that they are being laid off, according to two people who were directly impacted by the layoffs. These two workers were granted anonymity in order to speak frankly without risking professional ramifications. At least some of the workers who were alerted about layoffs will continue to work at PepsiCo until late April as they train their replacements in the coming weeks, the two workers told Business Insider.
By PepsiCo's own estimates, the company's layoffs are expected to be a multimillion-dollar project in 2019. Last Friday, PepsiCo announced in a filing with the Securities and Exchange Commission (SEC) that it is expected to incur $2.5 billion in pretax restructuring costs through 2023, with 70% of charges linked to severance and other employee costs. The company is also planning to close factories, with an additional 15% tied to plant closures and "related actions." Roughly $800 million of the $2.5 billion is expected to impact 2019 results, in addition to the $138 million that was included in 2018 results, the company said in the SEC filing.
My job can't be automated (Score:5, Funny)
I retrained (Score:5, Interesting)
After I aged out of my engineering job, I knocked off a MD. it was four years of memorization. All it takes is understanding of basic science.
I wish I just went directly into medicine. I'd be rich and it would have a lot easier than engineering. My colleague has an undergrad in art. The other in accounting!
Re:I retrained (Score:5, Funny)
Well, there is no lack in demand for creative accountants, you have to give him that.
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Re: I retrained (Score:2, Interesting)
Should we tell him that there will be a time when we lower H1B visa restrictions and import docs who have been educated to greater levels and at a tiny fraction of the cost he has, so are far more inexpensive to employ?
That's why there is such a cry in the tech sector about "lack of interest" in tech related fields in the US by students...when there actually isn't. It's just cheaper to get those workers from abroad. Workers who have grown up and been educated in economies with much lower costs of living and
Re:My job can't be automated (Score:5, Insightful)
I am a professional chess and Go player. Fortunately for me I am safe from automation.
The funny thing is they are. Humans haven't won at chess since Kasparov lost to Deep Blue, but Carlsen is making more than a million dollars a year as the world champion and is approaching $10 million in career earnings. You'd better be in the absolute elite though, it's like all sports the top athletes bring in way more than then second-best and being 100th best is worth almost nothing.
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Re:My job can't be automated (Score:5, Informative)
A new rookie to the NFL can expect to make around $365,000 per year
99.9% of wannabe football players never make it to the NFL. The vast majority earn nothing.
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99.9% of wannabe football players never make it to the NFL. The vast majority earn nothing.
Here is a non political suggestion I wish I could see made reality. Make a serious part of education the understanding and interpretation of risk and probability. If people understood, beyond any doubt, that becoming a top tier star of any form was incredibly unlikely, and instead made realistic plans and _worked_ to achieve them, we would be so much better off. It would also make the average Joe far harder to manipulate.
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To a large degree I agree with this.
I think part of the problem (at least for my generation growing up in the 80's and 90's) was there was a big push on this motivational stuff of "Don't let anybody tell you you can't make it.", along with inspirational photographs and stories of pop stars, pro-athletes, and billionaires.
While the motives were admirable and there is some element of truth there, the reality is that MOST people WON'T become those things. Even if they work hard for it. Most of those things a
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When I was in elementary school, I was repeatedly told that I could do anything I wanted because I was highly intelligent. Then I saw assorted career options close for reasons not related to intelligence. I've been tempted to write a book "Everything that held me back I learned in kindergarten".
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Intelligence is only a part of the recipe for success. You also need discipline, motivation, people skills, a good balance of executive functions (eg. organisation) "common sense", etc, etc
I've known plenty of very intelligent people, who know a lot about a wide range of subjects & are excellent problem solvers, but have been held back by a lack of focus, organisation & people skills.
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Re: My job can't be automated (Score:3)
The issue for me is using tax dollars or issuing municipal bonds to subsidize profit-making sports teams. They should go to the corporate bond market if they need money.
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99.9% of wannabe football players never make it to the NFL. The vast majority earn nothing.
... and those that do have an average career of 3 years, and significant risk of permanent brain damage.
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A new rookie to the NFL can expect to make around $365,000 per year, which constantly rises by about $5,000 to $10,000 per year. The very first stat I looked up destroyed your argument so..... Well, unless you think $365K/year is almost nothing..
Well I was thinking individual athletes like the 100th fastest at 100m dash or 100th highest ranked tennis player, like you're not even qualifying for the top events. For a team sport a fair comparison would be by position, where's the 100th best quarterback? With 32 NFL teams and one substitute each he's still playing college football where they're not paid except for a $20-$30k/year athletic scholarship. League sports are probably still easier though, all teams have their fans who have you as their favori
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I presume the GP was thinking about sports where people compete as individuals. Some team sports do indeed have a broader base of well-paid players, though still miniscule compared to the total number of people who play the sport.
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My job at the dick sucking factory is likewise safe.
Oh yeah? Fleshlite: https://au.askmen.com/dating/p... [askmen.com] (NSFW)
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No. Humans have a soul,
prove it.
something a machine will not easily emulate.
prove it.
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Why don't you give a brief rundown of evidence for a soul, rather than giving up immediately when challenged?
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I can provide evidence. It would then be up to you to show why the evidence is insufficient.
I have a hunch that no evidence would be sufficient for you.
Let me ask you this: what proof would compel you to believe in a human soul? Anything I showed you you would dismiss as science we simply donâ(TM)t understand.
Maybe literally anything showing it to be a real thing and not just a concept we like because it makes us feel superior to the rest of the animals. Present your evidence but if that evidence is feelings then it's not going to get very far.
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By 'automation' they mean replacing one form of labour by another which is cheaper and more compliant. To management humans and machines are all the same.
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The point is employees don't train robots to do their jobs. Technicians program machines to perform the tasks the humans did before. So clearly some of these "new workers" don't run on AC power.
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Replace a hundred workers with machines and 5 highly educated workers who have to know the job to make sure the machines are working right and to fix/reprogram them when not?
(Numbers pulled out of my ass)
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You mean sort of like the way the PC replaced all the Computers used in the Manhattan Project, right? You remember the Computers used in engineering back then, right? A bunch of (usually) women who did the multiplication and division and such for the engineers?
Or maybe you're talking about the way that the combine harvester replaced
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Huh? All those jobs still needed a few workers who knew the old or new domain. Combine operator should have some understanding of how farms operate, train engineer is a job that takes some skill. The automated factory needs people who can spot when the automation breaks and fixes it.
News for ...? (Score:1)
Computer chips are tech, tortilla chips aren't.
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Any job that can be automated will be automated when it makes economic sense.
No sense in replacing 10 minimum wage workers with millions in equipment and a $300,000 a year technician to run the machines. When the day comes that those machines are an order of magnitude cheaper and technicians are desperate enough for work that they can be paid double minimum wage.
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Management says "Relentless" (Score:2)
but they really mean that their jobs are safe from being replaced by small shell scripts or primitive AI services.
And some wonder why employee loyalty is so low...
Re:Management says "Relentless" (Score:5, Insightful)
You underrate the skills required by management. A good manager is nearly as rare as a good plumber. Both exist.
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A good manager is nearly as rare as a good plumber
A good anything, in my experience, is rare. If you want a lawyer, you find ten that are just form-filling paper-rustling head-nodding nulls for one that really can tell you what's your situation and what are your options.
Same for accountants. For doctors I'd say it's on the "one in twenty" order. Electricians, builders, you name it, and you have to really search to find somebody that is good at their jobs.
Sometimes you don't even notice because you have never ever seen a good doctor, or a good lawyer, and s
Re:Management says "Relentless" (Score:4, Informative)
but they really mean that their jobs are safe
RTFA. These are white collar "corporate" jobs being eliminated. They aren't laying off workers at the bottling plants.
Bonuses (Score:3, Funny)
In other words, all the involved will receive huge quarter bonuses for a few years, then once it badly backfires they will have departed with golden parachutes, while PepsiCo fills for bankruptcy, right?
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In other words, all the involved will receive huge quarter bonuses for a few years, then once it badly backfires they will have departed with golden parachutes, while PepsiCo fills for bankruptcy, right?
Don't confuse creative industries like writing code with production industries like making beverages. They've been automating that since the industrial revolution and it's an ongoing process of more and more self-regulating, self-diagnosing and self-correcting machinery that's quite often successful. It's not like a code base where it takes a few years to turn a well-maintained product into a train wreck.
Re:Bonuses (Score:4, Insightful)
I think you underestimate how much mid-level busywork can get automated in most businesses. In my own organization, I can think of a good half-dozen people who are going to be missing half their workload once their managers decide to get on the automation train.
One person spends a good day a week doing data entry into one system of data we already have in another system. Then they spend another half day dealing with the data entry errors causing problems down the line. Even if we just get them access to the one system and a script to change the data format and upload it into the other system, we're chopping a day and a half of work down to about 15 minutes of work. (Ideally we'd just link the systems, but that's a bit bigger project.)
There are piles of things like this in every organization.
It's quite possible that there are a few visionary people now in management positions who know full-well the rot and waste of time within the organization, and who are going to try to slim it down. Depending on how thoughtful they are, this could be a massive cost savings with minimal impact to the day-to-day operations.
Re:Bonuses (Score:5, Interesting)
One person spends a good day a week doing data entry into one system of data we already have in another system. Then they spend another half day dealing with the data entry errors causing problems down the line.
LMAO. You are so right.
On the other hand, it's not so simple a problem to solve; i've seen it tried. Sure it sounds like its a few lines of script... but inevitably there's a bunch of domain knowledge and data transformations being applied; and you end up 100k into developer time and it's still not quite right because the process was poorly documented, the consultants are money grubbing assholes, and the people with the information to fix it are the ones being fired so they're not exactly happy to help assuming they stuck around. Then it turns out you need a data feed from yet another system...
And the whole thing needs a highly technically skilled babysitter now to watch the logs and fix the problems in the automated process. He only needs 30 minutes a day instead of 1.5 days to do the data shunt, but he costs 10x as much; so the return on investment is taking a lot longer, especially after you factor the initial dev cost.
And then one morning the data format from one of the feeds changes without announcement from the producer (at the very least another department you don't have any control over... or often a customer, vendor, other 3rd party; and the whole thing implodes... and the consultants are billing doubletime to try and fix it. :p
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If you have a process where only one guy knows how to do it, you already have a problem. If that guy gets hit by a truck, or even just take a vacation, the entire business would come to a halt.
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It's not so much that only one person knows how to do it, its just that its not as rigid and simple as everyone assumes it is. A new hire can be trained on the basics in a day or two, and when exceptions come in they can just ask; the accountants all know or can deduce what to do with them on the fly. Or they can look how it was handled in the past to jog their memory.
Worst of all the specs are often constantly shifting. New customers and contracts are taken on and special handling is needed for them. The h
Looking forward... (Score:2)
I am totally looking forward to the significant cost savings of these changes being passed on to us consumers.
BWAHAHAHAHAHAHA. Sorry. Couldn't keep a straight face.
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The problem is that with ACA and Medicare, my tax dollars pay for your obesity.
Instead of taxing my income, they should be taxing your soda.
Or maybe instead of reporting our income on April 15th, we should report our weight.
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Their products cause zero obesity. Fuckheads drinking it like water causes obesity. But, we all know libs don't accept personal responsibility for anything...
HEY! I may be fat but I'm NOT a lib -- them's fightin' words! Water is good for ice and mixed drink "rocks", nothing more, I'll have you know. I only drink 2L of *Coke* a day, the stores hate to see me when it's dollar day, the limits they put on are for ME. (I asked one store about their purchase limit, and they mentioned that it wasn't for commercial use. I didn't ask what that was, I just got a 6-pack of 2Ls and went on my merry way. For a few hours.) Still trying to lose weight, but those pizza box
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Bingo, the southern states in the U.S. have the worst obesity rates in the country. The are also the most opposed to the ACA and Medicare for all. They simply do not equate their lifestyle with their death and health rates, and the Republican pols are not about to inform them of the link.
Re:A real UBI (Score:4)
You want a Universal Basic Income? Buy shares in PepsiCo. [...] UBI for shareholders of the ETF.
Do you find yourself confused by the world "universal"?
Re:Looking forward... (Score:5, Informative)
People aren't drinking as much soda pop anymore. The sugar stuff is bad for you with lots of calories. The diet stuff is turning out to be even worse for weight and blood sugar. Flavored waters are now the thing. I'm sure pepsi has some skin in that game, too, but not as much as they do traditional soda pop.
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Let's not forget the tooth damage, either. That stuff is bad for you on many different levels. It also tastes really good and is habit-forming, so it took a long time for me to get away from it.
Wait a second... (Score:5, Interesting)
At least some of the workers who were alerted about layoffs will continue to work at PepsiCo until late April as they train their replacements in the coming weeks
Are they training the robots?
Re: Wait a second... (Score:1)
Maybe they are training the engineering teams that will be automating their jobs.
It just seems like they're going about this all wrong. A big waterfall project that isn't likely to be on time or om budget.
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Automation isn't necessarily all or nothing. Automation tools might allow a team of ten experienced and expensive workers to be replaced with a team of three uneducated minimum-wage workers. Those three will still need a bit of training.
Re:Wait a second... (Score:5, Interesting)
Automation isn't necessarily all or nothing. Automation tools might allow a team of ten experienced and expensive workers to be replaced with a team of three uneducated minimum-wage workers. Those three will still need a bit of training.
I think that's backwards. The jobs eliminated by automation are typically the simpler and more repetitive ones, but even though those tasks are now automated you still need people around who understand those tasks well enough to ensure the automation is working properly.
So you're more likely to replace ten uneducated minimum-wage workers with three experienced and expensive workers.
If there is automation-related training of replacements I suspect they're training the technicians who know how to maintain the automated process with the tasks that are being automated.
Of course, this is /. so I'm mostly speculating and don't have a lot of actual experience.
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Most jobs - office jobs anyway - are not a single thing. For example, 80% might be manipulating spreadsheets and could be replaced with some Perl scripts and 20% something difficult to automate. You now need access to a Perl expert occasionally, but the day-to-day work might be reduced to the point of being done by a small number of people, and that small number might be entirely, or perhaps partly, low-skill.
That might be an extreme example, but there will be lots of possibilities and management will fin
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Most jobs - office jobs anyway - are not a single thing. For example, 80% might be manipulating spreadsheets and could be replaced with some Perl scripts and 20% something difficult to automate. You now need access to a Perl expert occasionally, but the day-to-day work might be reduced to the point of being done by a small number of people, and that small number might be entirely, or perhaps partly, low-skill.
That might be an extreme example, but there will be lots of possibilities and management will find the cheapest one, maybe even making compromises in terms of quality or risk management.
They were already making that compromise. The automation trend now is the same as the automation trend for the last 50 years. The least skilled people are the first ones to get replaced.
Sure there might be a few specialized skills that are lost post-automation, but the way to think of automation is as a productivity multiplier. If 10 cheap minimally qualified people can make 100 widgets ten while 10 expensive highly qualified people can make 120 widgets you take the 10 cheap people.
But if automation means o
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Not with todays robot production lines.
Shareholders and owners want the human risk out.
No unions, no wage pressure.
Robots all the way.
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... until late April as they train their replacements in the coming weeks
Are they training the robots?
Last place I worked was partly to fill in for another operator who had been redeployed to the far side of the facility, teaching a robot arm to do her (and my) job.
"workers" ? (Score:5, Insightful)
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So you think they're gonna move the bottling to India and then ship the product back here? Okay.............
RTFA. They aren't laying off the bottlers. It is white collar "corporate" employees getting the ax.
It's not India either (Score:3, Insightful)
This is gonna be "interesting times" as more and more work is automated. It's the #1 buzzword at every tech place I know of. And it's happening faster than new jobs can be created.
Good thing millions of unemployed and unemployable people are never a problem for long term social stability.
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And it's happening faster than new jobs can be created.
No it isn't. We have record low unemployment, and productivity growth is sharply lower than in the past [mckinsey.com].
A big problem in our economy is that automation is happening too slowly, causing weak wage growth.
Productivity stats are phony (Score:2)
There's a finite amount of work you can get out of a retail worker. Walmarts added robots to take inventory and Amazon's working them to the bone, but we're hitting the limits there.
Manufacturing & Farm outputs, which is the real measure of productivity increases, are way, way up.
As for unemployment, more lies. They're including "gig
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It's a competition. If Coke's better than Pepsi at selling diabetes, Pepsi loses business. There is no "good enough".
train automated replacements? (Score:3)
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Yeah, the summary is pretty bad. The layoffs are part of a “restructuring” and are more or less unrelated to the additional announcement that the company is “also relentlessly pursuing automation”.
Re:train automated replacements? (Score:5, Funny)
Maybe they're automating the layoff process?
Fortunately (Score:2, Funny)
Fortunately India, which is where production is largely being moved to, is known for its quality drinking water.
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Fortunately India, which is where production is largely being moved to, is known for its quality drinking water.
Pepsi Max, new flavour and now with intestinal parasites.
Indra Nuii did better (Score:2)
Sounds like (Score:5, Insightful)
There are not pesky US regulations (Score:3)
And this is automation. They're not hiring young folk. They're not hiring _anyone_. The jobs are just gone. Poof.
This just in (Score:1)
PepsiCo's board chose to further their cost-saving automation by replacing the CEO with a Magic 8 Ball, which they said "gives predictions which are just as accurate".
Translation from corporate to English (Score:2)
In civilized countries automation = shorter week (Score:3)
...not just more profits for robber barons and vulture capitalists.
German workers win right to 28-hour working week [telegraph.co.uk]
And then what? (Score:2)
....what happens after two years?
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And then if trends continue, they can strike for another 28 hour work week. Or 26. Or 22. As opposed to the Bezos's of the world just pocketing all the gains for themselves.
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Wait what? No sorry a bunch of people wanting to work part time for reduced pay is not the civilised end-result of automation. This is even temporary so workers aren't able to elect to do this beyond 2 years. This was nothing more than a work-life balance related negotiation tactic to not offer the original promised pay increases. It's great virtue signalling because we all know that people desperate for a 6.8% pay increase will jump at the idea of a 27% reduction in pay.
They also took careful aim at their
Not to worry (Score:2)
I "automated" not giving myself diabetes with their product a decade ago.
Huh? (Score:2)
"At least some of the workers who were alerted about layoffs will continue to work at PepsiCo until late April as they train their replacements in the coming weeks, the two workers told Business Insider. "
then
"At least some of the workers who were alerted about layoffs will continue to work at PepsiCo until late April as they train their replacements in the coming weeks, the two workers told Business Insider. "
They're training the robots or the other automation? Uhhh....
"professional ramifications" (Score:2)
"professional ramifications"
What professional ramifications? You're already losing your job.
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They probably risk losing the severance package as well.
Obvious targets for automation (Score:2)
Pepsi for a new generation (Score:2)
Always looking for their market.
Good luck with the automated. I won't be supporting the company nor its product.
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Personally I haven't seriously drank pepsi products in over a decade and this decision will just make that easier to swallow, heh heh.
So you completely missed the "retro" soda trend where makers bottled limited editions of their old sodas using real sugar?
You don't even have to do that. Just check your local grocer's "ethnic" foods section for the Mexican versions of your favorite soda. It wont be HFCS. My closet grocer doesn't even segregate them that way. Bottled Mexican Coke is in the same cooler as all the other 20oz-1 L bottles. Normally with the Boylan, Jones, and other more niche drinks.
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Re:"train their replacements" (Score:5, Funny)
'training' their robots
It's R2D2's brother, H-1B.
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Plano, Texas and Purchase, New York are corporate offices. Bottling plants are spread all over the place. So yeah, office jobs. Sadly, they didn't consider replacing Ramon Laguarta with a very small shell script.
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You can count me in! In fact, I started boycotting them over 30 years ago.
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You're confused, AC; you're actually thinking of Budweiser, or maybe Pabst Blue Ribbon.
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"..fizzy piss water." You're confused, AC; you're actually thinking of Budweiser, or maybe Pabst Blue Ribbon.
We used to call Miller's beer "Panther Piss", so maybe that's the one he's thinking of.