The following is an excerpt from a recent article from Site Selection magazine, featuring our own Director of Industrial Tenant Representation Services Chris Copenhaver, who assisted in the writing of the piece:
What keeps food and beverage (F&B) manufacturers up at night? It’s not how to formulate the next taste sensation or which color Gatorade will appeal to Generation Z consumers. Think food-borne bacteria recalls or jail time, a la Stewart Parnell, former CEO of the now-defunct Peanut Corporation of America. Food safety in all its iterations is the most important issue facing food and beverage manufacturers. “With longer supply chains and more complex food sourcing, that job is becoming more complicated,” according to the Food Manufacturing Update recently released by Cushman & Wakefield.
Food processors face a host of safety issues including regulations like the Food Safety Modernization Act (FSMA) and rules surrounding “free-from” diets, which address the handling and labeling of foods containing wheat, gluten, dairy, eggs and soy. And consumers are equally concerned that their food is being prepared in a facility providing safe and humane working conditions for its employees.
Historic Kraft Heinz brand Grey Poupon’s dark brown mustard will be produced at the company’s Holland, Michigan, facility.
“With the FSMA, the FDA is moving from the old food safety approach that reacted to potential harm to a new, preventive framework that puts greater responsibility on the food industry to identify potential risks to the safety of the food supply and counter the risks before harm occurs,” reads the report.
While that approach is great for consumers, it also impacts the bottom line for F&B companies implementing measures that mitigate risk. Putting in additional production lines to keep cross-contamination from occurring or to add improved methods of processing requires significant capital investment.
“The factors we’re addressing — food safety/regulations, plant efficiency, cold storage, demographics/consumption patterns — impact siting and operational decisions for food processing facilities,” says Chris Copenhaver, co-lead of the Food and Beverage Practice at C&W. “A food manufacturer’s ability to operate within a complex regulatory environment while efficiently operating their plant and effectively managing their food supply chain — which may have a ‘cold chain’ component — all while being laser-focused on satisfying the preferences and changing tastes of the end consumer, is the name of the game. An inability to achieve any of these objectives can cripple food enterprises. Siting considerations are often made with the goals of making the achievement of these objectives possible.”
Read the whole thing at the Site Selection site. There’s lots more on the consumer’s quest for fresh food at home, mustard’s role in the fresh food chain, and how the rise of craft beer is making an impact on farming.