- J.M. Smucker will invest $1.1 billion to build a new manufacturing facility and distribution center in McCalla, Alabama, to produce its Smucker’s Uncrustables sandwiches, the company said in a statement. The plant will create up to 750 jobs.
- Construction of the facility is expected to begin no later than January 2022, with production beginning some time in 2025. The plant marks the third manufacturing location dedicated to the Uncrustables brand, along with existing facilities in Kentucky and Colorado.
- The frozen handheld sandwich has grown to about $500 million in annual net sales, posting double-digit growth annually during the past decade, according to Smucker. The company expects to grow the brand during the next five years to approximately $1 billion in annual net sales.
Uncrustables, J.M. Smucker’s kid-friendly stuffed sandwich, has proven to be a big hit for the Ohio-based company. With food makers looking for avenues to grow sales in a competitive CPG environment, investing resources in such a brand makes sense.
But Smucker is betting that growing demand for Uncrustables will remain unimpeded well into the future to justify spending more than $1 billion to construct a facility that won’t be up and running for more than three years.
“Our Smucker’s Uncrustables brand continues to be one of the fastest growing in our portfolio and in the food sector more broadly,” Mark Smucker, president and CEO of the CPG giant, said in a statement. “We are proud of the success the brand has achieved.”
Uncrustables’ roots are based in peanut butter and jelly. But the company has expanded the frozen sandwich into pizza-like snacks containing sauce, pepperoni and cheese. It also has Sandwich Roll-ups in Turkey and Colby Jack Cheese and Uncured Ham and Cheddar Cheese varieties, Taco Bites and BBQ Chicken Bites.
The last few years offer a look into just how big of a success Uncrustables has become for Smucker.
Last December, Smucker Chief Operating Officer John Brase said in an investor presentation that net sales of the fast-growing Uncrustables brand hit $365 million in the company’s 2020 fiscal year ending April 30, 2020. Initially, the company was targeting Uncrustables sales of $500 million in its 2023 fiscal year. It appears to have reached that goal two years ahead of schedule.
With more adults returning to work and most children back in school, Uncrustables’ diverse portfolio is ideally positioned as an enticing option for on-the-go consumers looking for a morning snack, lunch offering or an afternoon pick-me-up.
Smucker is just the latest company to move forward with a construction project in order to meet increased demand — much of it spurred on by a jump in consumption during the ongoing pandemic.
According to an analysis by Food Dive, more than 70 manufacturing expansions have been announced or completed this year by food manufacturers. Those companies include PepsiCo’s Frito-Lay, Dole, Diageo, JBS USA, Tyson Foods, Nestlé and General Mills. Richard Branch, chief economist at Dodge Data & Analytics, said in the first seven months of 2021, construction activity in the manufacturing sector was up 40% from 2020. Half of the states in the U.S. have seen at least one new food industry facility this year.
Source by www.fooddive.com