For most food manufacturers, the cost of raw produce will be one of if not the biggest operating cost.
Food manufacturers typically have multiple operations and processes. Even the most efficient process line can be improved to reduce process cycle times, reduce wastage, improve quality, and ultimately reduce costs. Results from Sustainability Victoria's resource efficiency program found that implementing process improvements can reduce material costs by up to 40 per cent, while also boosting productivity and improving product quality and can typically deliver paybacks of less than two years.
Improvement actions could include redesign plant layout based on improving material flow and productivity, to redesigning a process line to eliminate or reduce process wastage or energy used. Learn more about process optimisation, how it’s done, and how it has helped many businesses improve operations and significantly cut costs.
Improving the way produce is inputted into processes including better measuring, spillage control and recovery for reuse and bulk loading can save manufacturers tens of thousands dollars. For example, Dennison Foods introduced a Bulka Bags loading system which more accurately measures dosage and are saving around 7,500kg of flour per year.
Many food manufacturing businesses are surprised to discover the value of products damaged during packaging processes. In addition to the cost of the input materials, there are handling and energy costs associated with this wasted finished product. Packing are key processes that can be looked at as part of improving overall operations. Consider engaging a consultant to identify opportunities and make recommendations for priority actions.
For most food processes, packaging is a major cost. Redesigning packaging to use less material or recycled material, or reusing packaging can result in significant savings. For example, Longwarry Food Park introduced improvements to how powdered milk was packed into bags and used thinner bags saving around $50,000 per year. There is a domino effect when you reduce packaging. More compact packaging will result in a reduced material cost. The amount of warehouse space for storage can be reduced and further savings can be achieved by redesigning pallet configuration and fitting more products onto a pallet.
Investigate opportunities to value add to unavoidable food waste streams. Food processers should look for opportunities to use wasted product. Examples from Sustainability Victoria's resource efficiency program include: a pasta manufacturer that created cooked produce from a food waste stream; a fruit packing business found a market to sell damaged fruit as seconds; while a fish food processer investigated using waste for fishing burley and fertiliser. Payback periods for value adding actions were typically found to be less than 1.5 years. Find how to reuse waste and improve your business productivity.
Good maintenance and upgrading of machines
Better maintenance of equipment and machines as well upgrading can achieve material savings of up to 20 per cent, often through investments with a short payback of one to three years.
Given that energy costs can be at least 15 per cent of total operational costs of a food manufacturer, energy efficiency improvements are becoming critical to both future profitability and competitiveness of the food industry.
Understand energy bills
Take the time to look at energy bills to understand how much energy is used. Talk to your energy retailer to check that you’re on the best tariff. Shop around; there may be better deals in the market to save you money. Businesses involved in Sustainability Victoria's resource efficiency program found savings as high $25,000 per annum.
Variable speed drives
The installation of VSDs on machinery with motors such as grinders, cutters, compressors, pumps and fans can significantly reduce energy use in with paybacks averaging four years on energy cost alone.
Good maintenance of and upgrading of compressed air systems including repairing leaks, installing drains on dryers, reviewing discharge pressure can result in considerable savings and with average paybacks found to be around two years. Learn about improving the efficiency of compressors.
One of the quickest ways to see energy reductions is to upgrade lighting to LEDs throughout the business, especially replacing energy intensive high bay lights with LEDs. Replacing high bay and metal halide lights with LEDs, and installing motion sensors, will reduce energy used for lighting by up to 80 per cent, while also reducing maximum demand. Lighting upgrades can also improve employee safety through increased illumination. Sustainability Victoria's resource efficiency program found typical payback periods of three years for replacing flouros and high bays with LEDS.
Investigate opportunities to replace cooking machines with more energy efficient ones. Look into the fuel sources of heating/cooking/boiling equipment. As gas is increasing in price, electrical sources are becoming more efficient, especially if businesses consider solar generation systems. Evidence from Sustainability Victoria's resource efficiency program looking at steam heating opportunities found average payback periods of less than 2.5 years for actions like boiler combustion control tuning, the introducing a steam trap leak programs, and upgrading or installing insulation.
Sustainability Victoria has a number of food processing case studies available.
SA food industry association Food South Australia has developed an excellent set of resources (Energy efficiency Toolkit) providing detailed information on how to improve energy efficiency of a range of operations and equipment as well as developing business cases for actions.
The Queensland EPA has developed a detailed Eco Efficiency Toolkit which offers food manufacturers advice on effective and efficient management of energy, water, raw materials and waste.
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