Out with the old…

gilgarre heinzIn May 2011, Heinz announced it was closing its tomato sauce factory in Girgarre in northern Victoria. This is at the expense of 154 jobs with possibly up to 1000 – 1500 people dislocated or affected. The company competes in a marketplace dominated by the duopoly and their private label brands. Profit margins can only be retained with cheaper inputs and labour; Heinz say they can only compete by processing offshore.

UPDATE 7 JULY 2013: Since the Heinz factory shut down, the Goulburn Valley Food Cooperative have been twice thwarted in gaining new premises. So they’ve decided to take advantage of underutilised Australian-owned operations to make their products. A virtual factory, they call it.

Next month sees their first products hit the shelves: organic pasta made at Casalare in Kyabram, and pasta sauce at the Riverina Grove gourmet food factory in Griffith, NSW. Apart from some of the spices for the sauce, the pasta and sauce combination is made from Australian produce.

It’s a welcome initiative to revitalise local food and short food chains… go Les and the GV crew!

For more details, visit gvfoodcoop.com.au

In with the new
The Goulburn Valley Food Action Committee is exploring options to try and save the factory. Les Cameron is offering the vision of a co-operative paradigm. He has a vision for value-adding to the “best tomatoes in the world”. He notes the quality of farmers’ market and sees the opportunity of taking this to a wider market.

“We’re all in favour of mass production, not mass production of crap,” he says.

Quality is how small dairies are successfully competing in a milk war; John Fairley from Country Valley has reported their sales have increased 28% when consumers started to question supermarket practices.

Good luck Girgarre! I also see opportunities in quality and a co-operative model.

For more, listen to the Radio National interview with Les Cameron and Professor Frank Zumbo.

cc photo by Leonid Mamchenkov

Related Elsewhere
SMH: Shane Green, Never say die, 7 July 2013.
WeeklyTimes Now: Sarah Scopelianos, Heinz rejects co-op offer for Girgarre site, February 23, 2012
WeeklyTimes Now: Sarah Scopelianos, Co-op disappointed by Girgarre factory, February 16, 2012
ABC Rural: Lucy Barbour, Heinz cans 146 workers as factory closes in Girgarre, 6 January, 2012
ABC 7.30: Heather Ewart, Manufacturing squeeze hits Heinz factory, 20 December, 2011
ABC Rural: Tony Cattermole and Lucy Barbour, Heinz rejects offer for Girgarre tomato factory, 15 December, 2011
ABC Shepparton: Joseph Thomsen Major investor kick-starts Girgarre co-op, 2 November, 2011

3 Responses to Out with the old…

  1. Another travesty where an international producer decides it can make cheaper product offshore, and yet I’d bet my left nut that the Girgarre factory was not producing anywhere near world’s best practise efficiencies! The value for WBP for an efficiency measure called OEE is 85%. The world average is 60% yet Australian manufacturers typically sit somewhere between 30%-50%.

    At the low end, that’s 55% behind other manufacturers so no wonder profitability is low! Having been in manufacturing for over 35 years I can name only a handful of Australian businesses that are anywhere close to WBP, and those businesses benchmark and drive their businesses to squeeze every last drop of efficiency out of their assets, while investing in modern equipment and their people.

    It ain’t rocket science, yet it seems a science that escapes most banal businesses who lack leadership and vision, which ultimately will result in more and more plant closures and Australia being nothing more than a hole in the ground and a giant farm owned by overseas interests. Shame Mr Heinz, shame …

  2. Thanks for this information Sharon, really interesting and I look forward to seeing how the plans develop. Good on them I reckon. Just one thing, the link to the Radio National interview with Les Cameron and Professor Frank Zumbo isn’t working, and despite some googling I can’t find it?

    1. Sharon says:

      Thanks Kathryn for letting me know about the broken link. Fixed! And here it is: http://www.abc.net.au/rural/telegraph/content/2011/s3314179.htm

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>