Walkers close Welsh factory

By Staff Reporter

- Last updated on GMT

Related tags: Snack foods, Lay's

The closer of Walkers' factory near Swansea signals the end of
fifty years of crisp production in South Wales as the firm moves to
cut costs.

The firm hopes to cut costs and make production more cost effective by relocating its operations from Wales to a new plant in Lancashire and other sites closer to its distribution centres.

The company, currently conducting a £20m (€29m) re-branding exercise, made the decision six months ago due to rising costs.

Margins are tight in an industry that is gentrifying into the premium market. According to Mintel, between 2002 and 2004, sales of standard crisps declined in value by seven per cent, whereas premium crisps increased in value by 15.8 per cent.

The closure of the Fforestfach plant, near Swansea, results in the loss of 250 jobs, with only 18 staff deciding to transfer to other Walkers' plants.

Walkers has been heavily criticised for its conduct during the closure. The firm sent employees a promotional pack of crisps as a goodwill gesture for losing their jobs.

A local newspaper quoted former a employee who said she found the gesture insensitive, although thought the new cheddar cheese flavour was nice.

400 million snacks are produced at the plant each year, including the Wotsits, Monster Munch, and Bacon Fries brands.

The factory, opened in 1948, was originally called the Smith's Potato Crisp factory and at its peak produced around 230 tonnes of snacks a week, according to local reports.

However, the company was taken over in the 1980's and along with Walkers became part of the US food giant Pepsi. Co.

Walkers now plan to sell the grade-two-listed building, which may attract a price of up to £2m (€2.9m) said a local newspaper.

The company has not revealed the estimated cost of the plant closure or the investment that went into the new factory.

The new plant in Lancashire will create 100 new jobs when manufacturing begins this month, with the possibility of expansion.

Walkers, which employs 4,000 workers at 15 sites in the UK, is currently the leading crisp brand in Britain, with more than 50 per cent of the market share.

The company's success is widely regarded as one of the factors in snack food rival Golden Wonder's recent demise.

Related topics: PepsiCo, Ingredients

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