Production at the site, which manufactured New Covent Garden chilled soups, has been transferred to plants at Peterborough and Grimsby, said chief executive Rob Burnett.
"Investing in Hythe Road to meet the anticipated future growth in demand for New Covent Garden soup, both in the UK and overseas, was not viable due to space constraints to meet our growth aspirations.”
Peterborough and Grimsby were both “leading edge food manufacturing facilities which will play a pivotal role in our future expansion”, he added.
“The closure has resulted in the loss of approximately 40 jobs, but eight former Hythe Road employees have transferred to our new Grimsby production facility.”
New site at Grimsby
His comments came as the firm marked the official opening of its new £8.5m site in Grimsby.
The factory, which was formerly occupied by Mariner Foods (which closed in May 2008), will create more than 200 jobs and could ultimately turn over £40M, Burnett told FoodManufacture.co.uk in March.
“We’ve actually had to dampen demand for New Covent Garden because we can’t keep up with demand, so that will create volume immediately, but we’ve also won new contracts to produce branded chilled ready meals for a third party and won more own-label ready meals contracts.”
The site will also make a new range of frozen soups for the catering sector, said Burnett. “We’ve invested in new technology for this, which will take us into new territory in terms of packaging formats with pouches and other things.”
Industry capacity in chilled food
While some major players in ready meals had reduced capacity recently, opening a new site might seem “counter-intuitive”, he said, but Daniels had maintained strong growth throughout the downturn. Given that penetration levels for chilled soup were just 30%, there was also plenty of potential to grow sales.
Daniels has doubled sales through organic growth in the last five years but was also on the lookout for acquisitions, revealed Burnett.