USA – World’s giant snack company, Mondelez International, has announced its intent to close an Enjoy Life Foods brand company in Jeffersonville Indiana starting in July, FoodDive reports.
The closure, announced via a statutory filing with the state government, will impact several employees. According to the company, several rounds of employment terminations will take place, with the first impacting 105 employees on 3 July.
The notice revealed that the action is expected to be permanent with the factory to close on or before 1 April 2024.
Mondelēz purchased Enjoy Life, a private snacking company in the fast-growing “free from” segment in 2015. A year later, it invested US$39M to open the 200,000 square feet Indiana facility just outside of Louisville, Kentucky.
The factory operates three production lines: a snack bar line can produce 780,000ft of bars per month, a cookie line 7.1 million cookies a month, and a chocolate line can manufacture 1,500 tonnes of baking chocolate annually.
Speaking to Food Dive via an email, the company revealed that the category, which avoids using allergens such as tree nuts, dairy, soy, egg, sesame, and fish in its products, has seen several companies enter the space.
Therefore, the influx of competitors has prompted Mondelēz to rethink its strategy, and while it’s not pulling out of the category altogether, it’s scaling back the number of products it’s going to make.
“A significant increase in the number and variety of offerings consumers now have to choose from in the ‘free-from’ snacking space, which prompted us to reevaluate the offerings of our Enjoy Life Foods products,”
In addition, the company said it remains committed to Enjoy Life Foods, hence they need to ensure that ELF can continue to grow in a way that makes sense for the business.
“As part of this shift, we have decided to exit our lease for the ELF manufacturing plant we have in Jeffersonville, Indiana as we refocus and narrow our portfolio.”
However, Mondelēz did not respond to a request for comment on what products it would stop producing.
With a strong portfolio of brands, Mondelēz is choosing to devote more of its attention to these products rather than overinvest in a crowded category.
While it is uncertain which products Enjoy Life is keeping, it’s likely to maintain production of those that are the best-selling, the fastest-growing, or leading in a certain food category.