Some of the fastest growing product categories in the food business are represented in the portfolio of WhiteWave Foods. That’s great news from a sales perspective, but it poses special challenges from a capacity point of view.
All of the 11 facilities in the WhiteWave production network came by way of acquisition: four plants in Europe, Earthbound Farm’s fresh-cut produce facility in San Juan Bautista, Calif., and most recently the So Delicious Dairy Free plant in Eugene, Ore. The others were inherited from Dean Foods, which bundled the plants with other assets when it spun off WhiteWave in 2012. (A 12th plant comes on line this month in DuBois, Pa., to support the firm’s expanded foray into cultured dairy.)
While Dean invested in and maintained its dairies in top condition — two of the sites received the EPA’s Energy Star designation for energy efficiency — only one had been in service for less than a decade. The Dallas plant was barely out of start-up mode when WhiteWave became a stand-alone company. Since then, the company has reoriented it into one of three cornerstone beverage sites and made it a showcase for the new corporate culture.
Organic milk, coffee creamers and plant-based beverages are WhiteWave’s sales all-stars. Those categories are riding two-year compounded growth rates of 16 percent for dairy and dairy alternatives, 8 percent in coffee creamers and 6 percent for organic products. Most food processors would happily swap their own categories’ growth rates for those kinds of numbers. They’d also have little sympathy for the difficulty of keeping the supply chain full for in-demand products, but expanding throughput capacity to meet demand is a major challenge for WhiteWave.
About 70 percent of products sold are made in company-owned facilities, with copackers filling the balance of demand, according to Jim Peacock, vice president of manufacturing. In-house production means faster speed to market, lower cost of production and greater quality control, and the firm has stepped up capital spending to optimize the supply chain and bring capacity in line with three-year forecasts.
Last year’s $128.9 million in capital expenditures equaled 6 percent of net sales and represented a 39 percent increase over the prior year. Some of that capital paid for six new filling lines, half of which were installed in Dallas, and more are on the way. A Mt. Crawford, Va., dairy is WhiteWave’s biggest producer, but additional lines in Dallas will add 50 percent more capacity in 2015 and push the plant to the No. 2 production site in the network, surpassing the City of Industry, Calif., facility. Weekly production at the 357,000-sq.-ft. Dallas plant already is approaching 1 million gallons of finished goods per week.
That new-plant smell
“Explosive growth” in Silk almond-based beverages and International Delight iced coffee coincided with development of the Dallas site, which was chosen partly because a mothballed 190,000-sq.-ft. frozen dessert facility provided an opportunity to take “a brownfield route” to production, explains Peacock.
A fast track schedule compressed the rebuild to six months, but escalating consumer demand made the original plan obsolete before the project was completed. Originally budgeted at $90 million for equipment and construction, the site already is an asset worth more than $300 million.
The 18-acre property was acquired out of bankruptcy by Dean in 2006 (frozen-dessert maker Americana Foods was the former occupant). The East and West Coast plants were slaking much of America’s thirst for Silk, Horizon and other WhiteWave brands, but logistics dictated a third plant to serve an area extending from Florida to Arizona and the Gulf to Chicago. Economic development incentives helped seal the decision to rebuild and expand the existing structure.
To the 142 production and 110 support staff in Dallas, the facility looks and feels more like a greenfield than a brownfield project. Except for some walls in the office area, the original structure essentially was demolished and rebuilt. The fit and finish of the production area and 11,000-pallet finished goods warehouse reflect the heightened safety standards for contemporary food production.
The facility also boasts a 2,400-pallet dry storage area, four batching rooms, five sterile storage tanks and a soy extraction system. With 13 shipping bays, “trucking companies like coming here,” says plant manager Matt Kuusinen. “They show up, we load them and they go.”
State-of-the-art filling technology from around the world handles the approximately 85 SKUs packaged in Dallas. The U.S. is represented by two Evergreen systems for gable-top containers. Aseptic-capable fillers from Sweden’s Tetra Pak and France’s Serac also are in service, though most products are refrigerated ESL. Shelf stable portion-control creamers are filled on an FDA-validated aseptic filler from Germany’s Bosch Packaging. The largest form/fill/seal machine for single-serve creamers in the Bosch lineup, the machine’s throughput is half again that of other Bosch fillers in the WhiteWave network.
Four crews staff the plant’s 12-hour shifts, with only a handful of production-free days a year. Baseline performance standards still are evolving, but the Dallas facility isn’t exempt from WhiteWave’s continuous improvement emphasis. “Building a new plant is really an engineering process,” observes Peacock, “and by the time you start up, the technology has moved forward again.”
LED lighting is one example. When Dallas was on the drafting table, LED’s foot-candles of luminescence would have been inadequate. That’s no longer the case, and the maintenance staff is in the process of retrofitting fixtures to take advantage of the 60 percent reduction in energy consumption that LED provides.
Similarly, CIP systems are converting to burst rinsing with rotating spray heads because of the significant water savings over continuous rinsing with stationary spray balls.
As WhiteWave’s first LEED certified facility, Dallas is helping burnish the company’s green credentials. WhiteWave’s inaugural corporate social responsibility report charts progress since 2006 in reducing greenhouse gas emissions by 32 percent, waste to landfill by 28 percent, and non-ingredient water use 6 percent per unit of production. Goals through 2020 soon will be unveiled, and each manufacturing site works toward internal goals for solid waste reduction, water and energy efficiency.
A separate budget for sustainability initiatives has given Dallas latitude to make the kinds of energy-efficiency investments that require longer payback periods. All three of the plant’s 800-hp Cleaver-Brooks boilers are outfitted with economizers the size of SUVs to capture waste heat in exhaust stacks and preheat boiler feed water. Extensive use is made of variable frequency drives on motors ranging from 8 to 200 hp. “In the end, it’s a huge (financial) savings,” points out Jon Lohr, maintenance manager.
Virtually every production worker is involved in one continuous improvement project or another. A Six Sigma team was mustered this year for a yield-improvement project for soybean blending. QA coordinator Dahisy Leyva, a black belt, worked with a Tetra Pak engineer and plant operators to reduce yield losses that ran as high as 15 percent. The reasons for losses were mapped via fishbone diagram to focus corrective actions. As a result, losses now average 4 percent.
With dairy, tree nuts and soybeans included in the raw-material mix, scrupulous sanitary practices to remove allergenic proteins are essential. Sanitation employee Andy Lepine and Maria Sharma, QA supervisor, collaborated on a sanitation protocol that is being rolled out network-wide and which earned a corporate recognition award for Lepine.
The program divides the plant into eight manageable zones for weekly cleaning. Multiple swabs, rinse-water tests and finished-goods testing are used to screen for trace amounts of allergens. Sensitivity as low as 2.5 ppm validates the effectiveness of the process. When a line changes over to a different product, disassembly of pumps and other components stretches out the changeover regimen to 9-12 hours. “It’s not the soft drink industry,” Kuusinen wryly notes.
Upstream and downstream machinery needs to operate at 80-90 percent overall efficiency to optimize a rotary filler that can output 550 16-oz. bottles per minute. A continuous-improvement team headed by Jeff Hancock and Benito Rosas refined a visual working instructions system that helped boost throughput 30 percent and cut changeover time in half. A 30-minute meeting involving maintenance, operations and management at the beginning of each shift was a key element of the improvement project.
Greenfield facilities have an opportunity to create a new culture before workplace habits are formed. “Occupational athletics” kick off each daily shift change at 6 a.m. and 6 p.m., when the entire staff gathers for stretching exercises and calisthenics. “We’re building a world-class culture with talented young people,” says Kuusinen.
Worker safety is non-negotiable. “We have the philosophy that every accident is avoidable,” he says. Focus on safety began with construction, when there wasn’t a single recordable injury involving the 350 on-site workers. One reportable injury occurred this year, but the Dallas plant’s OSHA incident rate is only 0.45. As the plant wound down its third year of operations, the days lost to injury record remained unblemished.
Plant managers are understandably proud of that record, but it doesn’t distinguish Dallas. WhiteWave’s Bridgeton, N.J., facility recently marked its eighth year with zero lost days. Peacock credits safety committees at each site and intervention practices that include near-miss investigations for pushing the company into the top quartile in food & beverage worker safety.
In a nation with 50 million lactose-intolerant individuals and growing demand for organic and non-GMO products, the upward trend in sales for WhiteWave seems certain. Matching sales forecasts with production capacity is the real challenge, and the solution will be found in three powerhouse plants: Mt. Crawford, City of Industry and Dallas.