What are the factors to consider when choosing industrial food manufacturing site?
- Strategic location
- Environment issues
- Completeness of amenities and utilities
- Local labor market attractiveness
- Government incentives
In the Philippines, the food manufacturing industry accounts for about half of the country’s manufacturing sector, contributing 23 to 24% of the annual GDP. Venturing into food manufacturing is a viable choice for many aspiring business owners because it is a fact that every person eats. and it’s clear that there are plenty of lucrative opportunities in the said sector. As such, choosing the site for your food manufacturing plant has a major impact on future business growth. To make sure you get the most out of your investment, here are the five factors to consider when choosing an industrial food manufacturing site.
Choosing an industrial food manufacturing site that has a strategic location is crucial as it has the biggest impact on the operation’s bottom line. You will have to consider if the location is conducive for raw ingredient pick-ups, finished product deliveries to distributors or end customers, and other internal material movements. To keep costs down, you don’t want the food manufacturing site to be too far from any daily operation travel needs.
This is why choosing the Light Industry & Science Park IV of Science Park Of The Philippines (SPPI) as your industrial food manufacturing site can help ensure your operations remain productive and cost-efficient. This industrial park in Batangas is strategically located nearby major highways and roads such as the Southern Tagalog Arterial Road (STAR) and President Jose P. Laurel Highway in Malvar. This means it will be easy to travel to and from Metro Manila for conducting business processes.
Robust access is key for shipping products to and from the food manufacturing site, and a convenient employee commute. Workers are the heart of food manufacturing operations. They are the ones that work in the production line to mix ingredients, monitor machinery, and pack your goods. Choosing an industrial food manufacturing site with a strategic location benefits your workers, allowing them to go to work and come home easier — a boost to their work-life balance quality.
The environmental conditions surrounding your new industrial food manufacturing site should also be taken into account. This is because neighboring locators may produce emissions and toxic elements that can impact the safety of your edible products. Choosing an industrial park by SPPI as your food manufacturing site would make it easier to be clustered alongside other businesses in the food industry, allowing you to never compromise the quality of your products.
The same goes for the wastewater ]your operations produce. You need to make sure you comply with environmental rules in regard to the waste generated during operations. Local governments typically have waste management regulations to protect bodies of water, public health, and the environment in general. In the Philippines, there is Republic Act No. 9275 (Philippine Clean Water Act of 2004) and Republic Act 9003 (Ecological Solid Waste Management Act). Failing to comply with these laws can result in hefty fines and imprisonment.
For this reason, it would be smart to choose a location like SPPI industrial parks which have provisions for wastewater treatment operations. Take the Light Industry & Science Park IV in Batangas as an example. It is equipped with a centralized wastewater treatment plant that treats up to 4,000 cubic meters of wastewater every day. A second wastewater treatment plant is being planned as well. This way you don’t have to worry if your food manufacturing operations are compliant with local environmental laws.
Completeness Of Amenities and Utilities
For today’s modern food manufacturing companies, the priority is to continuously keep up with consumer demands. Customers want their products readily available all the time, which means your business has to manufacture large product volumes. To do this, you must choose an industrial manufacturing site that meets your daily operation needs. A location that can fully support top-of-the-line food machinery in supporting your company.
There is a need for ample energy and water supply for manufacturing products.
Is everything you need in terms of amenities and utilities available at your preferred site? If not, additional costs may be required to make your operations feasible. At SPPI industrial parks, locators benefit from complete amenities and utilities. These include the following:
- High-power, independent electric grids that protect locators from sudden blackouts
- High-end communications cable
- Large-volume water supply
- Wastewater treatment systems
- 24/7 security
- Natural disaster protection systems
Local Labor Market Attractiveness
As stated earlier, your employees are the heart of your business and will be the ones to handle your day-to-day operational tasks. The last thing you’d want is to compromise the success of your business because of failing to attract and retain employees. For this reason, you must also assess if the local labor market is attractive for highly skilled employees.
Choosing SPPI industrial parks as your food manufacturing site proves to be a strategic move for attracting employees. Here are some of the benefits and amenities that employees can reap from working in SPPI industrial parks:
- Employee shuttles
- Proximity to bank, healthcare, and commercial facilities
- Open, green spaces surrounding work areas
- Security systems (stormwater management systems, fire brigade teams, security-manned gates, first aid kits, emergency evacuation routes guides, on-ground management teams that train locators’ fire response teams)
It’s always good to determine if your chosen industrial food manufacturing site will positively affect your bottom line in regard to government incentives.
In the Philippines, the local government offers fiscal and non-fiscal incentives for investments in special economic zones. The food manufacturing industry is identified by the Philippines government as a priority for attracting foreign direct investments (FDI) because of its average annual growth rate of 8 to 10%. Take advantage of the incentives being offered by the local government in special economic zones like SPPI industrial parks below:
- Exemption from corporate income tax
- Exemption from all national and local taxes
- Tax and duty-free importation of raw materials, machinery, capital equipment, and spare parts
- Exemption from export tax, wharfage dues
- Exemption from payment of local government imposts, fees, licenses, or taxes
- Exemption from expanded withholding tax
- Simplified import-export procedures
- Special non-immigrant visa for non-resident foreign national investors and dependents
- Non-resident foreign nationals may be employed in supervisory, advisory, or technical positions
In this article, we discussed in detail some of the factors when choosing an industrial food manufacturing site. There are plenty of things to think about to ensure the success of your food manufacturing business. If you are looking for the best industrial location in the Philippines, choose SPPI. Click here to check SPPI’s industrial parks in the country.