How to retrofit an aging plant

Food processors are retrofitting aging facilities to get more out of their capital budgets. But heed these “rules of retro” before you bring your plant into the 21st century.

By Mike Pehanich, Plant Operations Editor | 05/10/2005

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Anything to narrow the odds of success.

BUILD NEW OR RETROFIT?

The advantages of building new are many. Starting from a blank slate allows a knowledgeable team of designers to create the plant with the advantages of latest materials and equipment and the experience of prior successes and failures serving as a guide of what to do and not to do.

Retrofitting a plant poses a lot of difficulties, from accommodating production during construction to inheriting all the problems of age and out-of-date concepts, materials and equipment. Still, the potential advantages of lower cost and faster delivery usually outweigh the long list of pluses on the “new plant” side of the comparison during this era of tight capital budgets.

Here’s a side-by-side list of the pros and cons of building new and retrofitting your food plant, provided by Jeff Johns, vice president of Shambaugh & Son (www.shambaugh.com), Fort Wayne, Ind.

New Plant Retrofit
A new plant generally delivers what is really wanted and needed. Unused and depreciated assets can be utilized.
Built-in expansion and flexibility can be part of the design and strategy. Maintenance of a local brand equity can continue.
Demographics and efficiencies can reduce labor costs. Employment of experienced work-force can continue.
Technology, newer infrastructures, efficiencies, and employee working conditions can reduce unit costs. Existing technology may be updated.
Can reduce employee exposure to ergonomic illness and occupational accidents. Continuation of local relationships with customers, suppliers and regulators can occur.
Reduced logistics costs. Shorter start-to-finish schedule.
Increased product quality potential. Lower project cost generally.
Possible municipality and state tax incentives and subsidies. Production can be greatly impacted during cut-ins and could require strategic marshaling, heavy inventory/storage costs or co-packing.
Can consolidate production of multiple plants more easily. Cut-ins and demolition pose threats to product and occupational safety while plant continues to operate.
A more modern, better-looking facility. Egress is generally interrupted and area isolation may be necessary.
No production time disruptions. Facility could have limited expansion space, be land-locked or heavily regulated.
Opportunity to create a state-of-the-art, showcase plant. Facility may require additional engineering for proper documentation prior to project.
Plant may be subjected to higher standards due to loss of regulatory grand-fathering. Unanticipated hidden conditions may be discovered in demo/construction phases.
Longer start-to-finish schedule likely. Adverse materials generated by construction.
Higher costs. Requires modification, training and consistent monitoring of GMPs, sanitation, documentation and production scheduling.
Relocated equipment may pose challenges. Budget should have higher level of contingency funds for delays and unanticipated difficulties.
   

 

Transactional growth over 30 years
“Facility creep” can result in hot spots: 1. mechanical equipment spaces are inconveniently situated in remote areas; 2. product quality is affected by disjoint processing and packaging; 3. future processing/packaging growth will result in second relocation of parking lot and inefficient flow; 4. future growth of the shipping cooler will require an interruption to shipping while dock is relocated.


Generational approach
This approach allows efficient operation and room to grow: 1. plant utilities are centralized in a single area; 2. converting an existing cooler space into packaging allows expansion of processing and packaging while maintaining production in a single/contiguous space; 3. future processing/packaging growth can be added without disruptions; future growth will not disrupt shipping operations; 5. office expansions have been anticipated.

 

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