Inter LINK Foods is to close the recently-acquired Hoppers Farmhouse Bakery in a bid to consolidate operations. The 16,000sq ft factory in Herne Bay, Kent, will shut its doors early next year, with the loss of 130 jobs, when production will transfer to Inter Link’s highly automated 70,000sq ft Blackburn bakery.
Chief executive Paul Griffiths told British Baker that the factory was too small and would have needed modernising and further investment to make it more efficient. He insisted that it was a very good business which made 120 million mince pies last year – one of its specialities. However, this meant it had always been seasonally-biased and brought in the bulk of its profits in the run-up to Christmas. Said Griffiths: “We laid people off in January, but that happens every year because of the nature of the business.”
Inter Link bought the family company in 2004 for £5 million, saying it was confident that it would grow rapidly with the greater resources of the Inter Link Group behind it. Two years on, it was working to see if it could mitigate the closure. “Some employees may choose to move up to the northern factory but it won’t suit everyone, which means there will be redundancies. We are working with the union and local representatives to come up with a plan of action for them.”
The cake giant suffered its first major setback earlier this year, blaming unsuccessful promotional activity for a surprise profit warning. Like-for-like sales were up by 8% at £130m – £10m less than forecast.
“This is all about consolidating our manufacturing operations, which is as important to us as acquisitions,” said Griffiths, “although if the right deal came along, we would look at it.”