Cost Savings in Food Manufacturing

 

This Old Planet - is for Food Processing

This is an abridged version of an article that first appeared in Food Processing.

Every year, hundreds of food plants heed the call to expand production, improve quality, upgrade sanitation and safety or add a new line. Often all four areas are addressed at once. But when the plant in question is a little long in the tooth, it gets harder to teach old dogs new tricks.

 

Retrofitting an aging food plant can be problematic. Sober analysis may lead to the conclusion that a new plant is the simpler and, in the long run, more economical solution. Nevertheless, the predominant trend in the food industry is to undertake upgrades and retrofits rather than build new plants.

 

Sanitation and food safety concerns have driven many meat and poultry plant upgrades in recent years. By meeting its complex and highly challenging sanitation demands, the meat industry has set standards for plant hygiene that other segments of the food industry have adopted as well.

 

Other renovation scenarios revolve around the purchase of existing facilities at bargain prices. The deal may be too good to be true - and sometimes it is.

 

"Take an existing [food plant] structure and try to renovate it. By the time you have gutted it to get it ready for the new equipment, you have about 20 percent of the cost of the project left in the remaining facility," assesses one engineer.

 

This engineer asked not to be identified because he claims he has had more than his share of bad experiences trying to fit processing operations into bargain plant purchases.

 

Still, some major processors defend these "brownfield" purchases, provided a company has done its homework.

 

"There are a lot of situations in which you would want to buy a brownfield plant and convert it to suit your needs," says an engineering executive for one Top 10 American food and beverage maker.

 

"Often you are looking for a location that gives you access to a market. And often your schedule can be a driving force. You want to get that plant up and running fast, and, in most cases, you can get an existing plant up and running faster than you can build one from the bottom."

 

"Usually the decision [to retrofit] is predicated on cost and logistics," says Chris Harmon, senior vice president and project manager for Hixson (www.hixson-inc.com), the Cincinnati-based architecture and engineering firm specializing in food. "If you have a building that can accommodate your operation, you already have your building and perhaps wastewater system and utilities - electric, gas, water - already in place. And you have workers or a labor pool to draw from."

 

Planning should always start with a process.

  • Identify all your needs. Raw materials processing, finished product packaging, people flows, trash flows, rework flows, etc. Understand everything in that plant and what it does.
  • Analysis should include an exhaustive equipment list and documentation of that equipment and all its utility loads.
  • Project planning should consider all areas of potential benefit, even those beyond the needs driving the project. Safety, quality and other upgrades can be made at a fraction of what they might cost later and may even pay for themselves in savings, insurance costs or prevention.
  • Perhaps the biggest consideration of a retrofit of an up-and-running processing plant is what impact the project will have on production.

It all comes back to planning and analysis, knowing your operation, peering into whatever crystal ball you have at your disposal, mapping a detailed and comprehensive decision tree to handle whatever arises.

 

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