'Centres of Excellence' restructuring programme nearing completion
• Cadbury has invested NZ$69 million to turn Dunedin into a specialist factory and secure manufacturing and jobs in New Zealand.
• In the wake of rising operating and ingredient costs, Cadbury is reducing manufacturing costs so its products remain affordable at the checkout.
• The Dunedin upgrade into a world class specialist manufacturing facility is almost complete and it will make iconic products such as Cadbury Jaffas, Pascall Pineapple Lumps, Cadbury Chocolate Fish, Cadbury Pinky, and boxed chocolates for Australia and New Zealand as well as chocolate crumb, the base ingredient in Cadbury Dairy Milk milk chocolate.
• Some iconic Kiwi products, including Cadbury Moro, Cadbury Perky Nana and Pascall Eskimos previously made in New Zealand will now be made at other specialist factories, mostly in Australia
• Recipes will remain unchanged, wherever possible, as products move to different factories.
• Iconic Cadbury New Zealand chocolate and lollies made in Dunedin are about to be exported for sale at a major Australian retailer.
Cadbury Confectionery today confirmed that the restructuring of its New Zealand and Australian manufacturing operations into specialised Centres of Manufacturing Excellence is in its final stage. The project, originally announced back in September 2007 (with a further communication in August 2008) has already seen investment of $NZ69 million to improve the productivity, and secure the long-term future, of its New Zealand manufacturing operations.
As part of this program, Cadbury has now developed a state of the art centre for manufacturing boxed chocolates, and other iconic Kiwi products (Pineapple Lumps, Jaffas and Chocolate Fish) at its site in Dunedin.
However, as set-out in our original plans, establishing specialised centres of manufacturing excellence also means that some products previously produced in New Zealand will now move offshore; this includes iconic favourites such as Moro (to Australia), Jet Planes (to Australia), and Pascall Minties (to Thailand).
SPECIALIST FACTORIES
In the last two years, Cadbury has invested heavily to restructure its factories in both New Zealand and Australia so that each specialises in manufacturing particular types of products. These specialist factories (including Dunedin) have had antiquated equipment replaced with modern, state-of-the-art technology that allows Cadbury to make products more quickly, efficiently, and more cost effectively.
Cadbury New Zealand Managing Director, Matthew Oldham, said creating specialist manufacturing facilities has been integral to keeping significant manufacturing capability within New Zealand and also helped the business keep costs down for consumers, especially at a time when the price of confectionery ingredients has skyrocketed.
“The cost of ingredients like sugar and cocoa has gone through the roof in the last two years, and we have been working behind the scenes to keep our chocolates and lollies affordable”, he said.
KEEPING MANUFACTURING AND JOBS IN NEW ZEALAND
Matthew Oldham also said the changes to Cadbury factories and where some products are made are also about keeping both manufacturing and jobs in New Zealand.
“We are investing for the long-term in New Zealand so that our Dunedin factory will operate to world class standards. Confectionery manufacturing is an incredibly competitive business and we need to operate smarter to secure local production and provide Kiwi jobs. It’s simply not economical for us to make the same types of products in all of our factories so by specialising our products in certain factories we are able to keep costs down.”
PRODUCTS MOVING TO SPECIALIST FACTORIES
Mr Oldham’s comments follow Cadbury’s public announcement in September 2007, when it announced that it would be closing its factories in Avondale, Auckland, and Notting Hill, Melbourne, due to antiquated equipment and duplication of product manufacturing within its lolly factories. To ensure many of these products continued to be made for Kiwi consumers, Cadbury also announced that 90% of its lolly production would move to specialist factories in Dunedin and Scoresby (Melbourne, Australia) whilst a limited number of products would move to specialist Cadbury factories in Asia.
Following on from this announcement, in August last year, Cadbury informed the public it was investing $69 million to transform its Dunedin factory into a specialist manufacturing facility making the following types of products for the New Zealand and Australian markets. Many of these products will also be exported to countries throughout the Asia-Pacific region:
• boxed chocolates – including Roses, Continental and Milk Tray
• sugar coated lollies – including Jaffas and Pebbles
• marshmallow coated chocolates – including Pineapple Lumps, Chocolate Fish, Pinky and marshmallow eggs, and,
• ‘chocolate crumb’ – the base ingredient for Cadbury Dairy Milk milk chocolate
At the same time, Cadbury announced its Claremont factory in Tasmania would make all of the Cadbury Dairy Milk chocolate block varieties for New Zealand and Australia. Tasmanian-made Cadbury Dairy Milk block chocolate containing some New Zealand milk, and free from palm oil, is on New Zealand shelves now.
In August last year, Cadbury also announced it was creating a specialist factory for bars at Ringwood in Melbourne. Chocolate bars including Moro, Crunchie and Perky Nana that were previously made on old equipment at Dunedin will now be made on new, state-of-the-art equipment at Cadbury’s Ringwood factory in Melbourne. Australian-made Moro will reach retailer shelves in New Zealand in February/March next year.
Cadbury fully understands many Kiwis will be disappointed by the news that Moro will no longer be made in New Zealand. Cadbury New Zealand Managing Director, Matthew Oldham, said:
“Moving Moro production from New Zealand to Australia was a difficult decision for us to make and one we thought about for a long time. We’ve all grown up with this iconic Kiwi bar and it holds a really special place in our hearts but the reality was that our equipment in Dunedin was getting old and needed replacing, and with Dunedin becoming a specialist centre for other products we needed to make this change to help secure manufacturing and jobs in New Zealand.
“We are doing everything we possibly can to match the product previously made in Dunedin, so that Kiwis will continue to enjoy the taste of Moro they’ve always loved,” Mr Oldham said.
With the closure of the Avondale lolly factory, Kiwi icons such as Eskimos and Jet Planes will also be produced at Cadbury’s specialist manufacturing centre at Scoresby, Melbourne from early 2010. Some products such as Minties, Fruit Chews and Milk Shakes have already moved to Cadbury’s newly built Thailand factory. But iconic Kiwi favourites such as Jaffas, Pebbles, Pineapple Lumps and Pinky will continue to be made in New Zealand.
Dunedin also no longer has the space or sufficiently modern equipment to produce high quality Cadbury Creme Eggs so from next year the Cadbury Creme Eggs sold in New Zealand will be manufactured in the UK.
A full list of those Cadbury products changing factories is at the end of this media release and can also be found at www.cadbury.co.nz
RECIPES
Wherever possible, Cadbury is not changing the recipes of these products as they move to different factories, and is doing everything possible to ensure the taste that Kiwi consumers love so much is retained.
In isolated cases in the early stages of factory change-over, as occurred recently with Minties, consumers may notice slight taste differences in their favourite products. Often this can be caused by the different machinery used in the manufacturing process and not by a change in the recipe itself. Where such differences occur, Cadbury will continually work to ensure the taste is kept as close to the original as possible.
Matthew Oldham understands that some Kiwi consumers will be upset by these changes.
“Moving the production of these products away from New Zealand was a tough decision, and I wish we could continue to make them here. But we had to face economic reality - we can’t make them here anymore because the equipment is old and we need to specialise so that we keep jobs in Dunedin and ensure our products remain affordable for consumers.
“Wherever possible, we are not changing the recipes, just the factory in which they are made so if there is a taste difference, it should be minimal” he said.
DUNEDIN MADE PRODUCTS EXPORTED TO AUSTRALIA
New Zealand will also gain significantly from this restructuring process with the future of the Dunedin factory secured, and its establishment as a specialised manufacturing facility meaning a wide range of products will be exclusively made in New Zealand. Cadbury is also set to introduce many of its iconic New Zealand brands into the Australian market, so that ex-pat Kiwis (and sophisticated Australians!) can enjoy these products. This move follows an agreement reached with one of Australia’s largest retailers.
The deal will see hundreds of stores across Australia sell Kiwi favourites, including Chocolate Fish, which means more local production to take place in Dunedin to meet the increase in demand and more people being able to eat iconic Kiwi products.
You can see the full list of products here:http://www.cadbury.co.nz/About-Cadbury/Product-changes-Q-A.aspx
Let's chat about these changes at www.choclovers.co.nz