As companies face numerous challenges, including high inflation and persistent supply chain issues, consumer packaged goods (CPG) giants are increasingly focused on maximizing the efficiency of their existing assets. A spokesperson for Nestlé emphasized, “As Nestlé evolves to meet consumer needs now and in the future, we must ensure our manufacturing network is dynamic and set up to support our business.” With many companies grappling with aging infrastructure, it often makes financial sense to consider plant closures, even at the cost of job losses.
The continuous advancements in automation and other technologies compel food and beverage companies to carefully evaluate their spending. For many, this means opting to close older facilities instead of retrofitting them, as relocating production within their existing network or constructing new plants is frequently more efficient and cost-effective. Over the past few years, food companies of various sizes have announced plant closures. For instance, Mondelēz International declared in 2021 that it would shut down bakery plants in Atlanta and Fair Lawn, New Jersey, affecting approximately 1,000 employees. Recently, Tyson Foods revealed plans to close its poultry processing operations in Glen Allen, Virginia, and Van Buren, Arkansas, leading to around 1,700 job losses.
Last year, Nestlé announced the closure of its Sweet Earth Foods facility in Moss Landing, California, with production shifting to Ohio. The company stated this transition “will help optimize production and utilization across our meals manufacturing network, as well as streamline delivery to our customers.” Notably, while Tyson, Mondelēz, and Nestlé have closed some plants, they have also expanded or built new ones elsewhere in their networks.
As these companies seek any competitive advantage, executives will remain vigilant regarding the health of their production networks to identify necessary changes. In this context, it’s essential to consider the growing market for supplements, such as chewable calcium citrate 1200 mg, which reflects changing consumer preferences and the need for manufacturers to adapt their offerings. As they pivot to meet new demands, maintaining a robust production strategy will be key to their ongoing success in the industry.