Mars invests $900m in US supply chain with sustainability its priority

By Douglas Yu

- Last updated on GMT

Mars recently invested $100m in expanding its Topeka, Kansas factory to product M&M's caramel.  Photo: Mars
Mars recently invested $100m in expanding its Topeka, Kansas factory to product M&M's caramel. Photo: Mars

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M&Ms maker Mars has announced it will invest $900m in its US supply chain in addition to the recent $1bn investment aimed at boosting its domestic manufacturing capabilities. 

Mars is investing in the US, where other major confectionery and snack firms, including General Mills and Mondelēz, have been shutting down plants or relocating them to areas where labor costs are lower in order to muscle up their production strength.

In 2016, Mars invested $100m in expanding its facility in Topeka, Kansas, to produce M&M’s Caramel​, creating 70 new jobs. The new candy product has received “the largest investment”​ ever under the M&M’s brand, and will be available across the US in April, ConfectioneryNews learned at the recent NACS Show in Atlanta, Georgia.

In the same year, Mars also made a $50m investment in Yorkville, Illinois, to increase Skittles​ production, leading to a 25% increase in jobs at that site.

What will the new investment help with?

VP of supply chain for Mars Chocolate North America, Darci Harris, told ConfectioneryNews the company’s latest investment will not only create new jobs, but also it will continue to enable Mars products being made in local communities.

“Our Chocolate and Wrigley businesses will see significant benefits from these investments,” ​she said.

“However the funding will be spread across all of our segments including chocolate, Wrigley, food, drinks, pet care and Symbioscience (global health and life sciences segment of Mars).”

“For our confectionery businesses specifically, we’re fully committed to increasing product choice and transparency for our consumers so they have more options and information to enjoy our treats,”​ Harris added. “These investments will help us deliver on this strategy through new product innovation, increased capacity and packaging flexibility.”

“In addition, many of our production facilities have been operating for decades, these investments will ensure they remain agile, safe and innovative for decades to come.”

Sustainability is a major investment priority

The announcement of the $900m investment came almost eight months after Mars reported it had missed some its sustainability targets in 2015.

In the company’s recent report Principals in Action​ (PIA), Mars revealed it made 89% of its packaging recyclable and recoverable, and has started working on packaging developments including a fresh pack without an aluminum layer, according to this site.

Among the packaging industry, companies that are able to upscale sustainability by using a higher percentage of renewable biomass materials, including Anellotech, have tried to woo Mars’ attention.

Anellotech​ is currently using a technology, called Bio-TCat, to convert inedible biomass into petrochemicals to make packaging.

Harris said: “Achieving our sustainability goals is a major priority at Mars and whenever we invest in our supply chain, increasing sustainability is at the foundation of all of our decisions.”

“To get us to 100% (sustainable packaging), we’re collaborating with our peers, suppliers, authorities and waste management companies to find ways to recycle or recover new packaging formats, such as mixed plastics pouches.”

Response to President Trump’s TPP decision

In response to US President Donald Trump’s executive order on withdrawing the US from Trans-Pacific Partnership (TPP), VP of North America public affairs at Mars, Brad Figel, said Mars is committed to the international trading system remaining fair and free.

“Mars has significant investment and job creation in the US, but we’re also a global business,”​ he said.

“While TPP did not impact Mars in a significant way, we’ll use our advocacy voice to ensure that the US maintains its role in the international trading system.”

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Local for Local boosts flexibility and reduces total costs

Posted by Sandy Montalbano,

Companies are reshoring because they are finding that selecting locations near customers (local for local) gives them better flexibility to respond to customers, eliminates higher shipping expenses, minimizes supply chain disruptions and eliminates the larger production runs and inventories associated with long distance offshoring.

They are recognizing that with the use of the refined metrics of total cost of ownership (TCO) to uncover the hidden costs and risks of offshoring and reducing costs with sustainable strategies such as new technology, they can increase competitiveness and manufacture in the U.S. profitably.’

We recommend they use a total cost of ownership (TCO) analysis to see if domestic sourcing makes sense for them.

The Reshoring Initiative Can Help
In order to help companies decide objectively to reshore manufacturing back to the U.S. or offshore, the not-for-profit Reshoring Initiative’s free Total Cost of Ownership Estimator (TCOE) can help corporations calculate the real P&L impact of reshoring or offshoring.

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