One of the industry’s most talked about topics? It’s spelled “C-O-M…”
Thought I’d say “commodity costs?” Actually, last month’s “Top 150 Food Processors” issue had several top executives address skyrocketing ingredient costs. This month’s “Food Plants of the Year” interviews bring even more commentary (and it seems to become more heated with each passing day) from food plant managers and operations executives.
That said, I actually wanted to draw your attention to a small news item that - to me - reflects an interesting new wrinkle in today’s fast-paced food market.
Backing up for a second, I’m familiar with traditional co-packing where Company A (in one location) hires Company B (in another locale) to custom produce a certain item. Meanwhile, in the supply chain world, processors often hire a third-party warehouse operator to run a distribution center that’s attached to a plant.
My noteworthy news item? Nestlé Prepared Foods last month said that it will spend $60 million and add 50,000 square feet to its Jonesboro, Ark., plant all so that a co-packer, Chicago’s Nation Pizza Products, can run the on-site operation.
This is a first in my book. Here’s a case where Nestlé’s expertise is in traditional entrée processing but - lo and behold - some of its top-selling products (now reaching sizeable annual sales) are dough-based pizza items such as Lean Cuisine Brick Oven style pizzas and Stouffer’s Corner Bistro flatbreads.
I credit the company for thinking outside the box - while literally adding on to its own (plant, that is) - to seize growing market opportunity. Meanwhile, it’s taking this step with a proven co-packing partner with expertise in the field.
What I also find interesting, Part I Here’s one more example of value-added frozen foods growing in popularity. Known for shelf-stable sandwich spreads, baking mixes, shortenings and oils, The J.M. Smucker Co., Orrville, Ohio, quietly purchased Europe’s Best Inc., a Montreal-based marketer of premium frozen fruits and vegetables. Already a brand leader in Canada, Europe’s Best (one of R&FF’s “Ones to Watch” in 2006) has focused on building U.S. sales.
A little background: Although it tried and failed with Mrs. Smith’s frozen pies back in the mid-90s, Smucker has watched its Smucker’s Uncrustables frozen sandwich business ring up sizeable gains (including a 29-percent annual sales increase during 2007).
What I also find interesting, Part II: While covering the USDA’s recent Agricultural Outlook Forum, one meat industry publication observed that there was an overflow crowd for the Energy & Technology session, which focused on such topics as ethanol production and Brazilian soybean imports. Meanwhile - despite one of the nation’s largest ongoing ground beef recalls (involving Westland/Hallmark Meat) - there apparently were plenty of seats in the Food Risk & Security session.