Baking & Snack - March 2006 - 32

BAKER OF THE YEAR

through our R&D department for
formula adaptation to specific restaurant needs." Mission is recognized
as the No. 1 partner in R&D applications, according to Mr. Senise. Nearly
one-half of the Top 100 restaurant
chains work with Mission products.
Flavored tortillas are still by far the
fastest growing segment, although
not as large in volume as
regular tortillas, according
to Mr. Smith. The company

Gonzalez added. The company has
nearly 180 packaging lines, and improvements include adopting PLC
and servo-motor control among
other technologies. While market
pressures demand this change, it
will be a big challenge because most
equipment innovations are concentrated in the larger market of bread
and much less for tortillas.
"There is a lot of technical research applied to the bread indus-

Our goal is to be available where
our customers need us and support
the new markets we enter.
- Leon Zlotnik, US logistics, supply chain
offers 14 different flavors for food
service. Further penetration will be
in mainstream menus and nontraditional branched-out applications.
"This is where our non-organic
growth will come from," he said.
"Alternatives to bread or unique applications on menus generate interest
and growth."
OPERATIONS AND LOGISTICS. To
enhance efficiency within its plants,
Mission launched a major initiative
to cut its packaging costs, Mr. Senise reported. "Currently, 70% of the
company's workforce is engaged in
some aspect of the packaging function, whether it's bagging, putting
packages in trays, palletizing or moving pallets to the warehouse," Mr.
Gonzalez added. "We want to bring
the number to 50%."
The need for improvements is
driven by the mounting variety of
packaging configurations offered by
Mission as well as the rising costs of
labor. "This isn't about getting rid of
employees," Mr. Gonzalez said. "We
are growing and will continue to expand our workforce. This is about
using our people more effectively."
The packaging initiative will take
three to five years to complete, Mr.

34 / BAKING & SNACK / March 2006

try," Mr. Gonzalez said. "There is
not so much applied to tortillas,
and we are working with suppliers,
including Doboy, Bosch and FujiFormost, in addition to Tecnomaíz,
to improve packaging efficiency."
Plant rationalization is another
project to improve efficiency. Mr.
Senise said this objective does not
mean plants will be closed. On the
contrary, it is a project to assure
product is shipped from plants at
the lowest distribution cost. "For
example, we spent many years shipping tortillas to Minneapolis from
Pueblo," Mr. Senise said. "That is a
trip of more than 1,000 miles. Obviously, our New Brighton plant is better situated to supply Minneapolis.
Shifting service areas will continue
as markets develop.
"By no means are we looking to
shut down any plants," he continued.
"In fact, the opposite has been and
will be the trend, and we are ready to
redeploy assets as needed."
While extended shelf life is another way the company looked to
improve its economics, balancing
this objective with one to reduce
preservatives is a challenge. "The
company has dabbled with modified
atmosphere packaging and oxygen

scavenging among other approaches," Mr. Gonzalez said.
"Our target is to be as pure and
fresh as possible," Mr. Senise added,
"and that means locating production
plants as close to our markets as possible. With the recent acquisition of
a plant in the Bay Area in California
and Las Vegas, NV, the three CHS facilities and the new plant in Mountain Top, PA, that gives us 19 tortilla
manufacturing facilities in the US
and an additional 26 distribution
centers." Geographic coverage is beginning to transform from a horseshoe to a "W" as the company moves
up the center of the country.
"When we enter a market, logistics
are critical to success," Mr. Zlotnik
said. "Decisions on when to invest
in new distribution centers, routes
and new production plants are determined by the breakeven point,
and this is not a simple formula. It is
fluid and changes depending on the
market conditions. Oil prices have
greatly affected total distribution
equation and strategy."
Part of his job is to anticipate
growth and demand in regional markets. Working with operations, executive managers determine sources of
products, amount of capacity, existing plants, new lines, new plants and
so forth. For Mission Foods, distribution is now looked upon as an asset,
not a need. "If distribution is used correctly, we can increase operating margins drastically," Mr. Zlotnik noted.
"Transportation used to be a small
cost in the overall product cost.
Now it is sill increasing due to the cost
of fuel. Considering our volume, this
is significant."
USING ALL ITS RESOURCES. As a
Mexican company operating in the
US, Gruma works hard to blend cultures effectively both in how it goes
to market and in how it preserves
a good working environment at its
headquarters and plants. As might
be expected, the company's workforce is far more diversified than is

Baking & Snack - March 2006

Table of Contents for the Digital Edition of Baking & Snack - March 2006