Foodservice Equipment Reports

FER News Exclusive: How Customers Are Driving Manitowoc’s Factory Consolidation

Without much fanfare, Manitowoc Foodservice has undertaken a series consolidations and expansions of its cooking equipment manufacturing facilities in the past three years.

The New Port Richey, Fla.-based foodservice equipment conglomerate is currently finishing up a major expansion of its Cleveland manufacturing facility—at a total investment of approximately $10 million—while it winds down operations at the former Lincoln Foodservice plant in Ft. Wayne, Ind. The expanded Cleveland facility will now manufacture and distribute most of the company’s ovens, combis, steamers and steam-based equipment and fast-cook ovens in North America, including those sold under Manitowoc’s Cleveland, Lincoln, Garland, U.S. Range and Merrychef brands.

The expansion and consolidation in Cleveland follows a similar move to consolidate manufacturing of ranges, griddles—including two-sided platen products—induction technologies and similar equipment types in the company’s Mississauga, Canada, facility. A Garland factory in Freeland, Pa., was closed as part of that process.

The consolidations signal a significant shift in strategy, as Manitowoc moves manufacturing of cooking and hot-side products from brand-based factories in North America to three or four product-related facilities in which all brands with similar cooking technologies are manufactured. The company’s fryer manufacturing capabilities are centered in two plants in Shreveport, La.

During an exclusive, wide-ranging interview with Foodservice Equipment Reports Publisher/Research Editor Robin Ashton in early January, Phil Dei Dolori executive v.p.-Americas Cooking Solutions, explained the reasons for the new approach and how operator input, especially from major chain customers, helped drive the strategy.

“This really began with our overall strategy of delivering unique solutions, not just products, to improve our customers’ profitability,” Dei Dolori said. One might look at the consolidations and “think they are all about manufacturing efficiencies,” he adds, “and on one level they are.

“But the customers drove this too. Chain customers came to us and said ‘We don’t want a decentralized approach. We don’t want to have to go to the individual product divisions and have them compete with each other. Give us single sites where we can see all the possible technology options.’ One point of contact was key.

“So,” Dei Dolori continued, “[the consolidations] are not just about manufacturing efficiencies but efficiency with the customers. They can come to Cleveland and see all the solutions we can provide with ovens: speed-of service, product quality, labor savings, help with menu development. The real value of this approach will be on the customer side. Not just chains but other operators and channels partners, too.”

Dei Dolori explained that having the more centralized facilities helps in other ways that mirror Manitowoc’s three-part strategy: 1) Chain customer intimacy; 2) Solutions-based approaches for chains, other operators and channel partners; and 3) Enterprise-wide scale economies.

Manufacturing efficiency does remain part of the equation, Dei Dolori said, in part because customers demand cost as well as operational efficiencies. Part of the decision to move all the oven-type products to Cleveland was driven by an unplanned opportunity. As John Stevenson, v.p.-general manager in Cleveland (and a veteran of the auto industry), implemented a new in-line pull manufacturing system, a Toyota production technique that simplifies production of multiple and semi-customized products, “significant” floorspace was freed up. “And frankly, the facility in Ft. Wayne was underutilized,” Dei Dolori said.

Dei Dolori said the level of manufacturing skills available in the Cleveland area, the strong support of the employees at Cleveland and their United Auto Workers union “really created a win-win for us.” The union and Manitowoc negotiated a new multi-year contract and the City of Cleveland, Cuyahoga County and the State of Ohio “all stepped up” to help support the expansion.

The ice and cold-side of Manitowoc has pursued a similar manufacturing strategy worldwide. That side of the business is currently adding a new facility in Monterrey, Mexico, to go with existing plants in the U.S., the United Kingdom and China.

The company currently has hot-side manufacturing facilities in the U.S., Canada, the U.K., Germany, China and Singapore. “We call this a manufacturing enhancement strategy,” Dei Dolori told FER. “We’re investing more in manufacturing facilities than ever before. We need a cost structure that lets us compete on a global scale. That benefits us, but it also benefits the customers.”

Also included in the Cleveland expansion is a new test kitchen and training and demonstration facility where customers can come in and interact with the range of Manitowoc products, both hot and cold. The company now has more than 50 chefs and operates more than a dozen company-owned test kitchens in the U.S., Canada, Mexico, Brazil, China, India, Germany and Spain.

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