By Dominique Cantelme
From the January/February 2015 issue
One of the largest industries in the U.S., food processing involves converting fresh ingredients into finished goods. Regardless of economic conditions, people need and want to eat. They do it for basic survival, for medicinal purposes, for the pure enjoyment and for everything in between.
Food processing helps make the appearance and taste of the product more universally consistent; increases the seasonal availability of many foods; makes food preparation less time-consuming; and provides access to these foods to a much larger population. It also extends a food’s shelf life to aid in long-distance transportation as well as in long-time storage, and removes toxins from foods that would otherwise be unsafe to eat.
More than ever before, one of the most difficult tasks food processors face is information. Whether it’s a dietary, health or personal restriction, the more consumers learn, the more food “rules” we have. We want to know what ingredients are in it, where they came from and how they got there, why they are necessary and how they will affect us. Some may want organic, need nut free or prefer less sugar. Is the cow grass fed? Is the tuna wild caught? Are the eggs free range? Is it sustainable? Is the food full of additives or stripped of nutrients? Was it grown with pesticides or herbicides? What kind? Is the packaging BPA free? All valid questions when it comes to maintaining or improving our health and/or keeping to our beliefs. But whether it’s avoiding gluten, GMOs, aspartame and corn syrup or seeking to increase our protein, potassium and omega-3s, it all means more work for the industry.
Food can make you sick or help cure you, make you gain weight or help you lose weight, give you a headache or help prevent one, and generally improve your health or make it worse. No wonder it’s a topic of increased discussion and debate. Whether you’re a high-powered food executive, a factory employee, the truck driver transporting the goods or a consumer, food is your lifeline. What better reason to ask questions?
We can visit the Internet, farm or food store to find these foods that taste good and also meet our standards. And considering the fact that consumers do have so many food options, industry professionals that cater to what we want will be better off. Forthcoming companies that care about people as much as they care about profit will most likely make more of it in the end. Because regardless of what we are, or are not being told about what is or is not in our food, our bodies don’t lie. And the truth we’d like them to tell is that we feel and look great—with a clean bill of health.
Some food processing companies may bring new products to the table that meet this criteria or improve upon or alter existing products to meet expectation, demand or price point. But these are only some of the factors the industry has to consider. Companies are continuously looking for ways to cut production expenses, employ effective manufacturing techniques, reduce energy usage and optimize automation to lower labor costs. They also must consider their proximity to raw materials and their final destination. In the end, everything from where a food originates, how it is packaged and what it is packaged in, all the way to ease of its preparation plays a part in a food’s success story.
From the farms, canneries and packing plants to the butchers, bakers and supermarkets, the back end of the food industry operation has a lot to consider. Picking a location like the ones featured below can take a lot off a company’s very full plate.
CUMBERLAND COUNTY OFFERS RESOURCES AND INCENTIVES
Decision makers at Allied Specialty Foods, Inc., Bridor, Inc. and the Safeway Food Group all agree on one thing—they are able to develop and or distribute their products at a lower cost because of the unprecedented resources available to them in Cumberland County. Exceptional features include incentive options, progressive financing and a great workforce.
Bridor, Inc., a leading manufacturer of authentic European breads and Viennese pastry for the retail and foodservice industry, is investing $32 million to expand an existing 136,000-square-foot facility to 183,000 square feet and will grow their employee count from 132 to 177. Bridor has maintained its U.S. based advanced manufacturing operation in southern New Jersey since 2002.
GROW New Jersey, a state incentive option that rewards companies for job creation and retention, will benefit Allied Specialty Foods, a restaurant and retail food supplier with $13.77 million in tax credits. The financing will be used to carry out the company’s 10-year plan to relocate and expand to a larger 76,500-square-foot facility.
President and Co-owner of the Safeway Food Group Frank Tedesco says he has successfully hired 200 additional full time jobs for his company’s $3 million expansion. “There’s an abundance of people here who are able to adapt to our work culture and environment,” Tedesco, who previously owned a related business in a nearby county, said. “We employed a strong workforce from Cumberland County at our former location convincing us a qualified labor pool would be readily available for our new operation.”
Fresh Picked in Cumberland: Omni Baking Company, Bridor USA, Hanover Foods Corporation, Rich Products Corporation, Allied Specialty Foods, Inc., General Mills, Mamacita Foods, Perdue, Safeway Fresh Foods, Buona Vita Inc., Eatem Foods, Cumberland Dairy, F & S Produce, Townsend Farms and White Wave all operate here. This diverse group of regional, national and international food companies enjoys Cumberland’s abundant agricultural commodities and cold storage facilities.
“An urban oasis adjacent to a thriving and accomplished agricultural network—that’s why they chose Cumberland,” explains Jim Watson, Cumberland’s Economic Development Director. Less than an hour’s drive from Philadelphia, Wilmington, Atlantic City and the interstate highway network, Cumberland is positioned for economic growth, according to Watson. Boasting an infrastructure proven to benefit those in the agriculture or food product businesses, the County also offers attractive industrial park space and tracts of land conducive to the needs of the industry.
“We offer food companies and processors the right financial tools to reduce total project costs and ultimately increase their profits,” Watson summarized.
Cumberland County is central to some of the country’s most densely populated metropolitan areas. Its proximity to airports, major ports and railways also offers logistics and transportation companies strategic and efficient access to the Northeast region.
Incentives Are Plentiful Too: “Our incentive package is hard to match,” Watson explains. Local empowerment and enterprise zones offer not only tax abatements and low-interest loans, but also sales tax exemptions for construction, equipment and supply purchases. GROW New Jersey money is even available to companies with as few as 10 employees. “Imagine receiving $1 million for 10 years for hiring just 10 employees,” he explains. A host of local, state and federal incentives make it attractive for businesses to locate here including:
- Urban Enterprise Zones – provide tax credits and low interest rates to reduce development costs
- GROW New Jersey Program – offers significant tax credits for job creation and retention
- New Jersey Economic Redevelopment and Growth Program – special financing for businesses addressing revenue gaps in their development projects
- Brownfield Clean up Funding for developers investing in a re-purposed or redevelopment site
- U.S. EDA Public Infrastructure Funding – extends public infrastructure to a development site or provides public improvements for qualifying projects
- Cumberland Empowerment Zone – supports job creation businesses with federal loans, bonds, tax incentives and more
Creating a highly skilled workforce is the vision of Cumberland County’s progressive leadership. This vision is currently being carried out on the campus of nationally ranked Cumberland County College. Over $80 million is presently being invested in building a state-of-the-art high school technical education center along with a center for workforce and economic development.
The three facilities are being called an “economic development triangle” that will ensure the county’s stance of providing the quality workforce required to enhance and attract businesses to the area.
To support this vision, the County’s Employment and Training Office partners with company leaders to ensure they have skilled labor required for their operation with these workforce solutions:
- On the Job Training Grants
- Federal Employment Tax Credits
- Customized Training Grants
- Free Recruitment and Screening Services
Rutgers Serving Up Industry Resources: A distinct resource aiding food developers and distributors in Cumberland County is Rutgers Food Innovation Center. As an outreach arm of Rutgers, The State University of New Jersey, this National Business Incubator Association’s Soft Landings program is the only food-focused incubation program on the globe with such a designation.
The food experts of this business incubator and accelerator program provide business and technology development support and a shared-use manufacturing space, which is both FDA and USDA-inspected, for marketers and producers of value added food and agricultural products.
According to Lou Cooperhouse, Director of Rutgers Food Innovation Center, the Rutgers University program serves as a catalyst for both international and domestic food companies that want to establish a short-term presence and demonstrate the viability of their market before making huge capital investments.
Cumberland County Improvement Authority (CCIA) works in tandem with the Cumberland County Board of Chosen Freeholders to provide economic development and financial solutions. For more information, contact Jim Watson at (856) 825-3700, extension 1233 or [email protected], or visit www.ccia-net.com.
OSWEGO COUNTY: A PRIME LOCATION WITH A PREMIUM WORKFORCE
Situated in Upstate New York, Oswego County is located centrally next to New York City, Boston, Washington, DC, Philadelphia, Cleveland, Toronto and Montreal. Yet, Oswego County has more to offer than the logistical advantage of being within hours of every major Northeast market. Oswego County has the available industrial labor, infrastructure, import/export capabilities and supply chain for growth in the food manufacturing sector.
A skilled workforce, with previous food processing experience, is ready to work in Oswego County. The area’s workforce is supported by more than 30 institutes of higher learning and vocational training within 50 miles. Economic development partners, such as The Workforce Development Board of Oswego County, create opportunities to bring workers and employers together and work with colleges and vocational schools to encourage the development of courses that enhance workers’ skills and meet the needs of employers.
Oswego County offers convenient access to Interstates 81 and 90, which provide north/south and east/west movement. Over 25 carriers provide both local and long-distance trucking to and from Oswego County. Connecting lines enable transport to every major U.S. market. Local carriers provide transloading from truck to rail and offer myriad warehouse storage options, including dry, climate controlled and frozen.
The Port of Oswego, a deep-water port on the southeastern shore of Lake Ontario, provides a major logistical advantage to industry in Oswego County and the Central New York region. It is the first port of call on the Great Lakes within the St. Lawrence Seaway. As a hub in the Great Lakes St. Lawrence Seaway System, it is part of more than 2,300 miles of water transportation from Duluth, Minnesota to the Atlantic Ocean. The Port of Oswego provides on-dock rail and truck loading, making for a smooth transition of goods to market.
CSX offers daily rail transportation to Oswego County. In addition to rail access at the Port, service is available throughout the County, with direct access at several sites and industrial parks. With a nearby regional switching yard, CSX provides access to more than 21,000 miles of track in 23 states and the Canadian provinces of Ontario and Quebec, plus 70 ocean, lake and river ports. Coupled with nationwide transloading and warehousing, CSX makes rail a very viable transportation option for Oswego County businesses.
Syracuse Hancock International Airport is within minutes of Oswego County. In addition to worldwide passenger transport, Hancock has facilities for air freight transport, which includes a 53,000-square-foot cargo building. The Oswego County Airport boasts two 5,200-foot paved runways ideal for business, industry and private aviation.
Oswego County has many options for multimodal transport of raw materials, parts and products. The various combinations of transport are ideal for materials import and product export. As a designated Foreign Trade Zone (FTZ), Oswego County is designed for the convenient and cost effective production of goods.
Food processing has traditionally required high quality and heavy capacities of industrial infrastructure, which is where Oswego County excels. High quality potable water and available capacity for industrial wastewater treatment are available in Oswego County. Depending on your location, you could tap into nearly limitless water from Lake Ontario or access up to 10,000,000 gallons available daily from the regional water authority. There are also several options for water treatment including municipal treatment and a private treatment facility with over 5,000,000 gallons of excess capacity.
Greenfield sites, that are ready to build on, are available in Oswego County. Within the industrial parks, all sites have utilities and other necessary infrastructure in place. Some sites within the parks have had comprehensive site profiles performed. These profiles detail the site conditions, available infrastructure and provide development options suitable for that site. They expedite the selection process by eliminating much of the due diligence work for the potential purchaser.
All of these advantages have enabled Oswego County to attract three growing companies that have purchased existing facilities and expanded their food processing ventures.
Champlain Valley Specialty (CVS) of NY, in the Town of Oswego, acquired the former Empire Fresh Cuts and Oswego Growers & Shippers buildings, totaling 100,000 square feet. This established their apple processing facility closer to their suppliers and their market. CVS produces “Grab Apples” from locally grown apples that are sliced, packaged and shipped to local schools, retail markets, restaurants and their distributors.
Teti Bakery USA, Inc., is the newly formed U.S. subsidiary of Teti Bakery, based in Toronto, Canada. Teti Bakery’s 200,000-square-foot acquisition, in the Town of Volney, is their first U.S. facility and is strategically located for product distribution in the Northeast and along the Atlantic coast. Teti makes Italian bread products that are sold in supermarkets and used in restaurants.
K&N’s Foods USA, LLC, acquired the 280,000-square-foot former BirdsEye plant in the City of Fulton. They manufacture a wide variety of frozen valued-added Halal chicken products, under the brand license from K&N’s Foods Limited, Pakistan. This is the first North American facility for K&N’s, a popular international brand.
For more information about Oswego County, contact L. Michael Treadwell, Executive Director at Operation Oswego County, Inc., at (315) 343-1545 or [email protected].
FEEDING THE WORLD IN WISCONSIN
With the world’s population growing to an estimated 9 billion by 2050, access to safe food will be a major health issue facing both developed and developing countries in the coming decades. As a leader in food production and food science, Wisconsin is helping to solve the world’s food challenges. The state is home to more than 1,000 food processing firms and leads the nation in agricultural production capacity. Wisconsin’s agricultural and beverage leadership has drawn the attention of global industry leaders, with seven of the 12 largest food companies in the world maintaining operational facilities or North American headquarters here.
Wisconsin Feels Like Home: Ireland-based Kerry Ingredients & Flavors, the leading supplier of taste and nutrition solutions for the worldwide food, beverage and pharmaceutical industries, has maintained operations in Wisconsin since 1987. The company was drawn to the state for its distinct similarities to Ireland and opened its first overseas dairy ingredients and manufacturing plant in Jackson.
Andrew Lynch, director of Research and Development for Nutritional Beverages at Kerry, believes that from the beginning, Wisconsin was a natural fit for Kerry.
“There is a natural affiliation between Ireland and Wisconsin,” Lynch said. “With its rolling countryside and strong dairy industry, Wisconsin is another home for Kerry.”
In 1988, Kerry acquired Beatreme Food Ingredients, a division of Beatrice Foods, in Beloit. The Beloit location eventually became the company’s regional headquarters for the Americas. In 2001, the company expanded again in Wisconsin, opening a seasoning facility in Sturtevant.
Over the years, Kerry has established a global processing and technical network with an industry-leading portfolio of taste and nutrition systems for food manufacturers and foodservice customers in more than 120 countries. In 2013, the company reported $6 billion in revenue. With manufacturing facilities located in 25 different countries and international sales offices in 20 countries across the globe, Kerry was looking for a way to enhance its operations to keep up with industry demands.
To meet that goal, the company set out to further optimize its production footprint by investing in the expansion of two facilities, one focused on its seasoning business and the other on its dairy and culinary business. After conducting a company-wide evaluation of facilities under consideration for expansion, Kerry chose to invest in both the Sturtevant and Jackson facilities to meet its business needs.
Throughout the decision-making process Kerry collaborated with the Wisconsin Economic Development Corporation (WEDC) and local officials to ensure a smooth process was in place for both expansion projects.
After discussing project details with WEDC and county officials, Kerry determined it would be best to move its out-of-Wisconsin seasoning facility into the Sturtevant location. In addition, Kerry opted to relocate a spice warehouse from Illinois and merge it with the Sturtevant facility. The current Sturtevant location will be expanded by 76,320 square feet—allowing enough space for this consolidation and future seasoning acquisitions and growth.
The total Sturtevant facility project costs are estimated at $7.1 million. Project funding for the Sturtevant location includes:
- $300,000 forgivable loan from WEDC to assist with the building expansion
- $300,000 in tax increment financing assistance from the Village of Sturtevant
- $100,000 forgivable loan from Racine County
In addition, Kerry will merge 10 to 12 production and packaging lines from two other locations with its Jackson facility. The total expansion project at the Jackson location is estimated to cost around $18 million, with funding including:
- $597,000 WEDC tax credit to expand the facility
- $480,000 forgivable loan from Washington County
- Up to $2 million in tax increment financing district from the Village of Jackson
Throughout the entire collaboration, Kerry experienced a pain-free process while sorting out details with WEDC and local officials.
“The counsel and support received from WEDC and local organizations were significant contributing factors to our decision to make further investments in Jackson and Sturtevant,” said James Egan, director of Employee Communications and Engagement at Kerry. “We have a long-standing positive relationship with WEDC, partnering with the organization on several projects, and again it was really easy to work with them to meet our business needs.”
WEDC Resources: Food production firms that are looking to expand operations in the state will find the resources, support and opportunities they need. WEDC offers programs and incentives that celebrate business growth, and continually takes bold action to promote a business friendly climate that encourages expansion in the state.
To learn more about the food production industry in Wisconsin and programs to support this industry’s businesses, please contact WEDC’s Sector Development Manager, Cate Rahmlow.