Business Facilities - July 2008 - (Page 46)

LOCATIONS FOR THE FOOD PROCESSING INDUSTRY Food Processing Sites: Providing Sustenance as Well as Nutrition As food prices soar, sustainability becomes more than just an environmental buzzword—it’s the key factor in choosing a new location with access to raw materials and a customer base. By Stephen A. Sibert, Senior Vice President, Industry Affairs, Grocery Manufacturers Association A nyone searching for evidence of the interconnectedness of today’s world doesn’t really need to understand satellite technology, global capital flows, or game theory. Simply looking at the cost of a dozen eggs at the local grocery store should do the trick. Grocery Manufacturers Association (GMA) members, who operate within this web of mutual dependencies, have experienced increasing input costs throughout 2007 and 2008. Overall, crop prices are up 31% from last year. These raw material price increases can have a significant impact on manufacturers—large food companies attribute 45% to 55% of their products’ price to raw material costs, and the industry is not likely to see relief soon. Despite this challenging economic climate, U.S. consumer products manufacturers experienced a 10.6% sales growth this past year and delivered a relatively strong shareholder return of 7.3% in 2007, according to The Food, Beverage and Consumer Products Industry: Achieving Superior Financial Performance in a Challenging Economy 2008, a report prepared by PricewaterhouseCoopers LLP for the GMA. Released in June, the report states that even in a difficult economy with everincreasing commodities prices, agile consumer product companies can achieve growth by adopting successful practices in key strategic areas. The report found that the aggregate market index, known as the CPG Market Weighted Index, closely tracked with the Dow Jones Industrial Average and S&P 500 for most of 2007 and was in line with the market for two of the past three years (2005-2007). Another key finding of the study: While there is some A S P E C I A L A D V E RT I S I N G S E C T I O N O F B U S I N E S S FA C I L I T I E S 46 PHOTO CREDIT: DIGITAL STOCK CORPORATION

Table of Contents Feed for the Digital Edition of Business Facilities - July 2008

Business Facilities - July 2008 Contents First Word Snapshots Corporate Moves: New York The 2008 Business Facilities Rankings Report 2008 Rankings: Biotech Blasts Off 2008 Rankings: Green with Envy 2008 Rankings: Warm Climate for Business Nanotech Looms Large in Pennsylvania Metro Spotlight: Inland Empire, CA Food Processing Sites: Providing Sustenance as Well as Nutrition Sale-Leasebacks: Easing the Credit Crunch Corporate Moves: Georgia Metro Spotlight: Albuquerque, NM Advertiser Index Inside LiveXchange

Business Facilities - July 2008

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