Thursday, February 12, 2015

VIEW FROM THE TOP: Site Selection Trends and Factors in the Food Processing Industry, By Jay Garner

© Garner Economics, LLC.  All rights reserved.

If there is such a thing as a recession-proof industry, the Food and Beverage (F&B) Industry is it. During good times and bad times, people eat (and drink). Whether the economy is experiencing unprecedented growth or recession, folks continue to consume food and drink products.  Some eat to live while others live to eat. Some eat in, while others eat out. Today, the F&B Industry continues to expand and to evolve in order to meet the ever-changing demands of consumers.

In the United States 30,135 companies are defined as F&B process manufacturers (up by more than 1,500 companies since 2010). These businesses employ more than 1.4 million employees.  However, a 47,000 decrease in employees since 2010 demonstrates how innovative manufacturing processes and automation can mean fewer jobs. Where are the growth opportunities? Organics and naturals; ready-to-eat; health and wellness; ethnic; and comfort foods have seen the highest instances of development.

Economic development professionals that meet F&B company location requirements should actively recruit this viable industry sector. Water availability and capacity is the number one consideration in the location analysis process, followed by wastewater options and labor availability.

The following are the five key sectors that comprise the food processing industry:

·        - Meat, Seafood and Poultry
·        - Fruits and Vegetables
·       -  Beverages
·        - Bakery
·       -  Dairy
California leads the way, followed by New York and Texas In the top 10 ranking of states with food processing facilities (see chart below).

Click Chart to Enlarge
As a firm that specializes in siting food-processing facilities, Garner Economics sees eight areas of growth opportunities and location trends in the F&B sector.  They include:

11.  Organics and Naturals.  Once viewed as fads, organics and naturals  are here to stay, despite the costs associated with growing and processing. United States Department of Agriculture guidelines limiting toxic or persistent fertilizers and pesticides have precluded large-scale corporate organics farming. Consequently, smaller farming operations produce organics, and the projects associated with them, too, are small in scope and size.

22. Specialized beverages.  Infused drinks or nutraceuticals, such as vitamin water, green tea and fruit drinks, are showing considerable growth. Conversely, conventional soft drinks (sugar drinks) are indicating a history of flat or declining sales.

33. Ready-to-Eat. At the present time there is a high consumer demand for prepared foods. In the last decade, grocer freezer sections have expanded to accommodate a plethora of oven-ready meals. Companies that manufacture ready-to-eat meals typically employ sizeable kitchen staffs which process, prepare and cook the product prior to packaging. Having a culinary program in your community is a great tool in selling this opportunity to F&B companies that need those skill sets.

44. Private Label Brands. Economic developers should focus on grocers that have a private label brand processor. Cost conscience consumerism today has driven increasingly more grocers to manufacture their own label products, resulting in private brands occupying significant shelf space. (Publix, a grocery chain based in Lakeland, FL, has eleven product manufacturing facilities.)

55. Grow Local/Build Locally (a key location trend). Energy costs, particularly high fuel prices, are propelling manufacturing and distribution facilities, including food-processing companies, to carefully consider location decisions. Proximity to suppliers and consumers is central, evidenced by the trend in processing facilities being built near farms. Instead of from farm to table, it is from farm to plant. Companies with exorbitant annual expenditures in energy costs would naturally opt for locations close to major transportation arteries. This may change if oil prices continue to fall below $60 a barrel.

66. Health and Wellness (including animals). These products provide ingredients that target certain conditions, such as high cholesterol. They will remain popular with consumers as they age and become more concerned with daily health choices. More growth is expected in this subsector since the profit margins are greater for companies with these value-added items.

77. Age Awareness and Portion Control Products. Age awareness products address the nutritional needs of children, seniors and pets. Portion control products, such as 100-calorie snack pack foods, make it easy for consumers to monitor calories while eating on the go. Many processors are either retooling their product lines to accommodate consumer demand for this or building new facilities.

88. Ethnic Foods. Ethnic foods, especially Hispanic, account for the largest consumer growth in specialty foods. An expansive Hispanic market is responsible for the sizable growth in California facilities.  Based on changes in U.S. demographics, this trend should continue.

The foremost issues facing F&B companies are food safety; energy and utility cost and availability; incentives; and supplier risk management.

Primary food safety concerns for food companies are contamination, product tampering and terrorist threats. A salmonella outbreak at an egg or peanut processor, for example, can create far-reaching problems for company, product and community. Garner Economics worked with a South Georgia community that experienced a salmonella outbreak in a peanut processing plant.  Because the company was a dominant employer in town, the community was affected when the company ceased operations and ultimately went out of business.

F&B facilities carefully consider energy and utility costs, plus utility availability, when analyzing and executing location decisions. Higher energy costs have resulted in facilities strategically being placed close to interstate highways and major arteries. Water is a major utility component for food processing companies, utilized as an ingredient, a sanitizer agent, a cleaning tool, and as a mover of materials. Communities without excess water capacity will not be on company or consultant’s radar.

Incentives also can play a role in F&B facility location decisions. Because equipment costs often are more than buildings, companies value incentives. Finally, during this past recession, some food processor suppliers who were highly leveraged did not survive. As a result, some food processing companies had to scramble to find suppliers for needed product or commodities. There are more processors today that also will own or control the commodity and are better prepared to weather economic cycles.

In summary, Garner Economics sees continued growth annually in the following F&B Industry sectors: Organics and naturals; specialized beverages; ready-to-eat; private label brands; health and wellness; age awareness/portion control products and ethnic foods. States, regions and communities must strive to create innovative ways to differentiate themselves in an increasingly competitive F&B location field. Does your community have (at least) one food processor of moderate size? If the answer is, “yes,” the likelihood is there is that there is infrastructure to accommodate more. 

About Jay Garner: Jay A. Garner, CEcD, CCE is the president and founder of Garner Economics, LLC, an economic development and site location consulting firm headquartered in Atlanta, GA, with representative offices in Berlin, Germany and Seoul, Korea.  Jay often lectures and provides counsel on creating and implementing proactive global business development strategies and tactics. His firm is also a leader in providing assistance to corporate clients in their site selection process, such as Anchor Glass, Academy Sports, Hatfield Quality Meats, Stork Food Systems, Future Pipe Industries and others. Garner Economics and Primus builders have partnered to create one of the most extensive certification initiatives in the economic development and food/beverage industry. Their goal is to help communities prepare for the location of F&B projects, which also helps companies in that industry sector (many of whom are our current clients) understand that a community has met Primus / Garner's rigorous review requirements. To learn more about the Primus/Garner Food Site Certification designation, click here.

Sunday, February 8, 2015

Focused on Excellence

Avoid mediocrity and overconfidence

By: Jim Walton
Brand Acceleration, Inc.
Having lived through several economic cycles, I’ve seen more than a few recessions and recoveries. I’ve also seen companies succeed or fail because of the ability or inability to manage the shifts. It has always amazed me to watch how business owners respond to times of feast and famine.

During tough times, just as in the business startup period, business owners will do just about anything for a client. They pull out all the stops, providing excellent service and delivering well above customer expectations. Then, when the economy improves and business is good, owners often forget the importance of excellence and become complacent and arrogant, often killing their golden goose.

In the marketing and public relations business, history is littered with the dry white bones of agencies that were once darlings of the industry. They often forgot what caused their success and then died a painful and embarrassing death.

I remember one agency that was launched by four bright young men who had outstanding backgrounds and buckets of talent and creativity. They worked hard, dazzled their clients, and grew their agency into a company where people wanted to work and with which companies wanted to do business. The company began attracting larger clients and cash poured in. Cha-ching!

A series of painful mistakes
But then, something changed. The four owners forgot their humble beginnings. They became proud and arrogant, making dumb moves that clients and employees seriously disliked.

One of the first things that got noticed was that the owners were unavailable. Scheduling a meeting or phone conversation with them was nearly impossible. They were just too busy for such things.

Then, in an effort to grow revenues and maximize their very valuable time, they dramatically raised prices and installed software to track every billable minute. When a client called, the clock was started and charges were tallied.

A painful ending
Over time, many of the agency’s original and smaller clients vanished, along with much of its best talent. A handful of larger clients remained and the company was seriously vulnerable. One day, the firm’s largest client announced that it was leaving, going to another agency. Ironically, the new agency was a small boutique firm, owned by a group of hungry owners who would do anything for their clients. In short order, this once proud company lost its luster and suffered an agonizing and sad demise. Jobs were lost, homes were lost, and many people were hurt.

Last week, I was in a community, visiting with economic developers, elected officials, and community stakeholders, listening to their passion for economic growth. With a somewhat high unemployment rate, these people are willing to do whatever it takes for jobs and investment. They told me stories of the extremes to which they go to attract and court employers. Their “whatever it takes” approach is encouraging to see. Whether a project will bring ten jobs or hundreds makes no difference. These people will tear down any barriers to make the deal happen. Period.

My promise
At Brand Acceleration, we’ve been blessed with great success. In just a few years, we’ve grown into a leading marketing, public relations, and website development firm by remaining passionately focused on providing excellent service in one industry – economic development. My promise is that we will never forget who brought us to this point.

Our wonderful clients have entrusted us with a very important place on their teams. A role we will never take for granted. They see us as more than just a vendor. They understand that we are part of the team and will do whatever it takes to help them succeed.

I also know that if it were not for our team of brand strategists, researchers, writers, designers, programmers, videographers, and expert vendors, we could never deliver such a high level of excellence.

And, I would be remiss if I didn’t mention our valued allies. We can’t do everything and proudly rely on friends to provide such services as community assessment, workforce development, site consulting, business retention and expansion counsel, lead generation, GIS services, fundraising, and countless others. We know we always have friends who can work alongside us to serve the needs of our clients.

As we move into the New Year, my promise to our clients, staff, allies, and the economic development industry is to provide excellent service and fare pricing. We will always live up to our promises and will never let you down. I know we play an important part and promise to remain focused on your success.

Thank you very much,

Jim Walton
Brand Acceleration, Inc.
Branding // Marketing Communications // Public Relations
Indianapolis, Indiana:
Office: 317.536.6255
Cell: 317.523.7380

Brand Acceleration is a full-service marketing communications, brand management and website development firm with a focus on community and economic development.

Good Economic News

Here are just a few of the recent jobs announcements that have crossed my desk in recent weeks.

In Montgomery City, Missouri, potato chip and snack maker Uncle Ray’s will open and hire 110 people.

In Greensboro, North Carolina, chemical company Ecolab, Inc. will expand and create 45 jobs.

In Joplin, Missouri, shed maker Cook Portable warehouses will open and hire 80 people. Congrats to economic developer Rob O’Brian.

NHK International Corporation, a maker of auto suspensions, will grow in Novi, Michigan, creating 26 jobs.

In York County, South Carolina, precision products maker Schaeffler Group North America will expand and create 112 jobs. Congrats to economic developer David Swenson.

In Richland, South Carolina, food distributor Hardon House Food Products will expand and hire 55 people.

Agility Fuel Systems, a maker of vehicle fuel systems, will open in Rowan County, North Carolina, creating 149 jobs. Congrats to economic developer Robert Van Geons.

CGI will open a facility in Lafayette, Louisiana, creating 400 jobs.

Mercedes-Benz USA will open its headquarters in Atlanta, Georgia, creating 800 jobs.

In Clark County, Indiana, plastics compounders Chemtrusion, Inc. and MyTex Polymers USA Corporation will expand and hire 11 workers.

In Buncombe County, North Carolina, White Labs, Inc., a provider to the brewing and wine industries, will open and hire 56 people.

Biopharma products supplier Emergent BioSolutions will expand in Baltimore, Maryland, creating 158 jobs.

In Athens, Tennessee, auto component maker Denso will expand and create 400 jobs.

In Fitzgerald-Ben Hill County, Georgia, wood processing startup Choice Wood, Inc. will create 50 jobs.

Medical device maker SGS Specialty Group will expand in Columbia City, Indiana, creating 17 jobs.

Auto components maker Android Industries will expand and hire 131 workers in Detroit, Michigan.

In Scott County, Indiana, label maker Multi-Color Corporation will expand and create 154 jobs. Congrats to economic developer Robert Peacock.

Educational supply company will expand and hire 44 people in Kansas City, Missouri.

In Bowling Green, Kentucky, KapStone Container Corporation will expand and create 30 jobs.

Merritt Island Boat Works will open in Brevard County, Florida, creating 380 jobs.

In Dooly County, Georgia, Tyson Foods will expand and hire 500 people.

Plastics maker Sirmax North America, Inc. will open in Anderson, Indiana, creating 50 jobs.

Rite Aid Corporation will open a distribution center in Spartanburg, South Carolina, creating 600 jobs.

In Walker, Michigan, seating maker Irwin Seating Company will expand and add 60 workers.

In Gwinnett, Georgia, Validation & Engineering Group will open and hire 20 people.

Auto components maker LOC Performance Products, Inc. will expand in Plymouth, Michigan, hiring 95 people.

Polydeck Screen Corporation, a maker of screen media, will expand in Spartanburg, South Carolina, creating 40 jobs.

In Mesa, Arizona, Apple Computer will open a command center and hire 150 workers.

Logistics provider Bluegrass Supply Chain Services will expand in Bowling Green, Kentucky, creating 55 jobs.

Auto supplier OMR Automotive will open in Speedway, Indiana, and hire 60 people.

Vinegar maker Marukan will open and hire 15 people in Spalding County, Georgia.

Near Lake Charles, Louisiana, Live Oak LNG will open a liquefied natural gas facility and hire 100 workers.

Metal stamping company Lincoln Manufacturing USA, LLC will expand in Stanford, Kentucky, adding 20 employees.

In Natchez, Mississippi, paper products supplier Von Drehle will open and create 100 jobs.

In Fayette County, Georgia, Osmose Utilities Services will open and hire 100 people.

Total Jobs Announcements: 5,173

Jim Walton
Brand Acceleration, Inc.
Branding // Marketing Communications // Public Relations
Indianapolis, Indiana:
Office: 317.536.6255
Fax: 317.222.1425
Cell: 317.523.7380


Brand Acceleration is a full-service website development, marketing communications, branding, and public relations firm with a focus on economic and community development.

Wednesday, January 14, 2015

VIEW FROM THE TOP: Doing Your Diligence – Foregoing Assumptions, by Courtney Dunbar

Economic Development Leader, Industrial Site Consulting Team
One of the hottest economic development trends right now involves site certification. Site certification involves identifying a list of diligence factors, assessing a site for assets and deficiencies, curing deficiencies, and then preparing the site to accommodate prospective users.

While site certification programs are helpful in quickly identifying site attributes, these programs were never intended to be all-encompassing. The programs just weren't designed to replace thoroughly assessing a site for suitability to specific, individual users. That responsibility resides with the site selector and the company to make the decision on the location for the business' new home. Site selection decisions are optimally made following a thorough site diligence investigation.

Why Diligence Matters
The average American will state that the largest capital investment they will make in their lifetime will be their homes. Now, if you own a home, consider all of the diligence you underwent in making the decision to purchase. You likely checked the school district, the transportation routes to areas of personal significance, the home's condition, the property's suitability, the property tax rates, and the proximity to services. Diligence matters.

Now, consider the site selection process for an industry. Company representatives are making multimillion- if not multibillion-dollar capital investments when they invest in a site. The products they produce require significant infrastructure support and capacity.

Labor matters. Roads matter. Rail matters. Zoning matters. Other analytical site preparedness items matter. Timeliness to market is paramount. An underestimation of a site's ability to serve specific industrial needs can result in catastrophic outcomes, including closures, layoffs, or worse. Diligence matters.

It is critical for companies to thoroughly perform the due diligence and planning of industrial sites as part of the location decision-making process. Companies simply cannot afford to take a risk on a "maybe this site can serve" or "we think we can obtain property control. Absolutely, without a doubt, risk avoidance in the form of site preparedness is crucial to site selection decisions.

No Shortcuts
Site selection has evolved considerably over the last few decades. As companies have become more efficient in their processes, the timelines for selecting new sites have become shorter. The shortened duration of time to vet sites under consideration can lead site selectors and company decision-makers toward a path of least resistance, creating an environment where important site attributes are missed prior to selecting the final site for development. This mistake can lead to costly development delays and missed opportunities. As many as 75 different site and community attributes may be needed to provide an in-depth analysis of a company's ability to function at optimum efficiency. Identifying the risk-to-development factors is not only wise, but also assists the site selector and company in playing the selection game intelligently.

Additionally, thorough site diligence provides site selectors and companies with the ability to save critical resources by limiting the amount of land purchased to the amount of land needed; the means to determine how their sites will serve their facilities and if the sites are zoned properly to protect them from adjacent users; as well as the ability to negotiate incentives that provide the most impact. Foregoing assumptions on site preparedness and practicing thorough site diligence is crucial to successful development.

Courtney Dunbar has 17+ years of combined career experiences in economic development and project funding. In her current role as economic development leader, she is actively engaged in industrial site planning, community planning, economic analysis, and identification of project funding options.

Friday, January 2, 2015

Good Economic News - Over 8,000 New Jobs!

Here are just a few of the recent jobs announcements that have crossed my desk in recent weeks.

In Charlotte, North Carolina, financial giant Wells Fargo will expand and add 83 workers.

In Boone County, Indiana, IT firm Smart IT will open and create 85 jobs. Congrats to economic developer and Brand Acceleration client Molly Whitehead on a job well done.

Food maker Archer Daniels Midland will open in Erlanger, Kentucky, creating 200 jobs.

In Sherman, Texas, Renew Blue Industries will open a recycling facility and hire 100 people.

In Laurens County, South Carolina, packaging products maker CCL Label DES will expand and create 98 jobs.

At three locations in Michigan, electric motor maker Brose New Boston, Inc. will expand and add 475 workers.

In Plantersville, Mississippi, furniture maker OptimComfort, Inc. will open and hire 70 people.

In Bluffton, Indiana, electric motor maker Bluffton Motor Works will expand and add 70 workers.

In Poplar Bluff, Missouri, Mid-Continent Nail Corporation will expand and create 91 jobs.

Transportation industry products maker Hubner Manufacturing Corporation will expand and hire 50 people in Charleston County, South Carolina.

In Baton Rouge, Louisiana, Honeywell will expand and add 60 workers.

E-commerce provider Memory Ventures will open in Fishers, Indiana, creating 134 jobs. Congrats to economic developer Tim Gropp.

In Beloit, Wisconsin, Chicago Fittings will open and hire 20 people.

Tosaf USA, a maker of advanced polymers, will open in Gaston County, North Carolina, creating 75 jobs. Congrats to economic developer Donny Hicks.

In Venore, Tennessee, Yamaha Jet Boat Manufacturing USA, Inc. will expand and add 150 workers.

In Louden County, Virginia, medical device maker K2M Group Holdings, Inc. will expand and add 97 workers.

Limestone Quarrier Indiana Limestone Company will expand in Oolitic and Bloomington, Indiana, creating 75 jobs.

In Iowa, soybean processor Ag Processing, Inc. will expand and hire 20 workers.

In Calcasieu, Louisiana, Venture Global LNG will open a liquefied natural gas facility and hire 100 people.

In Putnam County, Indiana, Scorpion Protective Coatings, Inc. will expand and create 25 jobs. Congrats to economic developer Bill Dory.

Safety Training Services, Inc. a training firm, will expand in Lake County, Indiana, creating 16 jobs.

Packaging maker Sigma Packaging, LLC will expand in Vanderburgh County, Indiana, creating 43 jobs.

In Clinton, Tennessee, 3M Company will locate a facility and create 100 jobs.

In Columbus, Ohio, online retailer, will open a fulfillment center and hire 40 people.

Plastics maker Suburban Plastics will expand in Grenada, Mississippi, creating 60 jobs.

In Augusta County, Virginia, heat exchanger maker Provides Metalmeccanica SrL will open and hire 45 people.

Industrial contractor Reinicke Athens, Inc. will open in Laurens County, South Carolina, creating 30 jobs.

In Coldwater, Michigan, pork processing firm Clemens Food Group will open and hire 800 people.

Healthcare company Cardinal Health will expand in Indianapolis, Indiana, creating 85 jobs.

In Oxford, Mississippi, mortgage technology provider FNC, Inc. will open and hire 310 employees.

Machining company UPS Midstream will open in Jena, Louisiana, creating 95 jobs.

In Schuykill County, Pennsylvania, consulting firm TruBridge will open and hire 100 workers.

In Indianapolis, Indiana, insurance provider Conner Insurance, Inc. will expand and create 23 jobs.

In Greenwood County, South Carolina, wood pellet maker Portucel, SA will open and create 70 jobs.

In Indianapolis, Indiana, electronic heath record provider iSALUS will expand and add 136 employees.

Lear Corporation, an auto component supplier, will expand in Portage, Indiana, creating 96 jobs.

In Jackson, Tennessee, Orchid Orthopedic Solutions Alabama, LLC will expand and hire 35 people.

Coatings maker Mankiewicz Coatings, LLC will expand in Charleston, South Carolina, creating 15 jobs.

In Cedar Rapids, Iowa, Iowa Brewing Company will open and hire 16 people.

Automotive supplier M-TEK will open in Murfreesboro, Tennessee, creating 100 jobs.

IT provider CloudBlue will expand in Indianapolis, Indiana, creating 50 jobs.

In Wake County, North Carolina, Overland Contracting, Inc., an engineering and construction firm, will open and hire 89 people.

At two locations in Michigan, robotic assembly line maker The Paslin Company will open in Harris County, Georgia, hiring 90 people.

In Fargo, North Dakota, business services provider Integreon will expand and hire 100 people.

Healthcare provider Edmedics LLC will expand in Louisville, Kentucky, creating 17 jobs.

In Spencer, Iowa, Simonsen Iron Works will open and hire 28 people.

Real estate firm Kite Realty Group will expand and hire 69 people in Indianapolis, Indiana.

Materials handling company Coperion Corporation will expand in Wythe County, Virginia, creating 22 jobs.

In Ponchtoula, Louisiana, Elmer Chocolate Manufacturing will expand and create 20 jobs.

Logistics services provider Hyundai Glovis Georgia will open in Harris County, Georgia, hiring 190 people.

Software provider Adminovate, Inc. will expand and create 81 jobs in Philadelphis, Pennsylvania.

In Bowling Green, Kentucky, brake maker Bendix Spicer Foundation Brake will open and hire 75 workers.

Mining equipment maker Deister Machine Company will expand in Indianapolis, Indiana, creating 110 jobs.

In Minden, Nebraska, Royal Engineered Composites will expand and hire 30 workers.

In Warsaw, Kentucky, pet food maker FreshChoice Complete Diet Products will open and hire 22 people.

Grain Processing Corporation, a maker of corn products, will expand in Washington, Indiana, creating 16 jobs.

In South Bend, Indiana, molded rubber products maker South Bend Modern Molding will expand and hire 80 people.

In Clark County, Indiana, NIBCO, Inc., a maker of valves and fittings, will expand and add 40 workers.

Retailer Target Corporation  will open a fulfillment center in Memphis, Tennessee, creating 400 jobs.

In Livonia, Michigan, insurance technology firm David Corporation will expand and hire 26 people.

Wood products maker Cox Industries, Inc. will expand and hire 60 people in Orangeburg County, South Carolina.

IT services provider Thomas Automation Management LLC will expand in Carroll County, Virginia, creating 15 jobs.

In Middlebury, Indiana, trailer maker Grand Design RV will expand and create 330 jobs.

Power distribution maker Universal Electric Corporation will expand in Washington County, Pennsylvania, creating 300 jobs.

Auto components maker Haring will open a facility in Hartwell, Georgia, creating 800 jobs.

Fresh produce distributor Castellini Group will open in Clayton County, Georgia, creating 300 jobs.

Kindred Healthcare will expand and hire 500 people in Louisville, Kentucky.

Total Jobs Announcements: 8,153

Jim Walton
Brand Acceleration, Inc.
Branding // Marketing Communications // Public Relations
Indianapolis, Indiana:
Office: 317.536.6255
Cell: 317.523.7380


Brand Acceleration is a full-service website development, marketing communications, branding, and public relations firm with a focus on economic and community development.