Greencore's US business could generate half a billion dollars in sales by 2015 if growth continues at current rates, its US boss has revealed.
Fergal Leamy, who took the helm of Greencore USA last spring following the acquisition of Massachusetts-based Home Made Brand Foods (HMBF), told Food Manufacture: "Ultimately, we strongly believe that the US business could grow to be the same size as the UK business. I will be disappointed if we are not turning over $500M in five years. It all depends on how quickly the US market adapts to chilled, but the signs so far are very encouraging."
Greencore USA currently operates from two sites employing 440 staff between them: the HMBF facility in Massachusetts and a sandwich plant in Cincinnati. "With the appropriate investment, the Cincinnati site could turn over $100M," said Leamy, who has brought over nine permanent staff from the UK to help drive the business and seconded seven more on short-term contracts.
The HMBF site, which could also turn over $100M, was capable of generating around $30M in sales of sandwiches alone, he predicted. "The upstairs of the site is all devoted to sandwich production now."
Greencore envisaged operating around "nine sites over the next five to seven years, with three in the north-east, three in the mid-west and three on the west coast", added Leamy. "The plan is to grow organically and through acquisition, although there aren't that many acquisition opportunities in chilled prepared foods here - which is why we moved into this market."
While some customers accustomed to selling sandwiches and deli lines had switched from making them instore to receiving deliveries of pre-packed products from Greencore, others were starting to sell them for the first time and were investing heavily in new chilled fixtures to house them, he said. "Sandwich sales in our Kroger and Hannaford stores have been going really well and we are hoping to launch with another major customer in the next month or so."
One of the biggest challenges for the fledgling business had been logistics, as the infrastructure to handle short shelf-life chilled foods was not "anything like as advanced" in the US as it is in the UK, said Leamy. "We've had to work very hard with our suppliers of bread and produce to ensure we get consistent deliveries early in the morning so we don't miss our own delivery windows."
A lot of effort had also been devoted to improving operational efficiency at HMBF by introducing techniques that are standard in UK chilled food production, said Leamy. "We're about half-way through an 18-month programme to drive efficiency and increase our technical capability."