Food manufacturer growth plans requires plant capacity increase

Developing a plant expansion strategy for a food manufacturing business to transform the production lines, establishing a platform for the business to grow

 

Production capacity constraining business growth

In line with the company’s long-term strategy, the sales and marketing team forecasted significant growth across a range of its product portfolio. This came at a time when all plants were already running at full capacity. The customer needed to understand the capital and fit-out requirements, and had to consider 3 scenarios before arriving at a decision. First was to do nothing, in which case the opportunity for growth would be lost. The second option was to upgrade and lay on extra shifts to get higher yield from the kit by running a 24/7 operation. And the third option was to transform the business by implementing a shutdown with upgrades and renewals of production lines across the site to address the increased production requirements.

 

The third option, required structural changes which would require significant investment. There were risks changing production lines that needed to be taken into consideration with new facilities required on site, infrastructure upgrades to utility services, warehousing and the layout of the site. In effect, there would have to be a re-organisation of the site as part of an overall master plan.

 

Strategic plans to upgrade the production lines

Malone Group was engaged to help develop strategic plans for the customer to enable business growth and tackle the production capacity issue. The strategic project leader, heads of departments and operational directors were involved in the process to identify shortfalls and opportunities for growth. Some of the production lines were to be upgraded to deliver faster productivity as well as provide the ability to produce product variants. There needed to be enough space freed up or made available to install a new production line. This project was expected to be a €12.5 million capex project, delivered over a 12 month period. It also involved taking other production lines down, to facilitate a change over and the consolidation of two lines into one line was a key enabler for the installation of an upgraded new line which would add 50% to 70% capacity. The old line was to be scrapped. In total, five upgrade projects and a new production line project were planned. The initial estimate was that this could represent a £50m investment and would be subject to a separate feasibility study.

 

The facility, like many was old and consequently, existing site information was poor and typically out of date as services changed on the site over the years and were not documented. This was regarded as a high priority issue and the first stage of the project involved the development of drawings and documentation to map the current site and facilities accurately.

Food & Beverage