RMR Process has established itself as a key player in Australia’s food and beverage manufacturing industry through expert insights on how to best enhance the entire production process.
Based in Melbourne, RMR Process employs a team of expert engineers with a proven track record in designing and constructing top-tier food processing facilities, alongside providing strategic growth support to clients.
RMR Process takes pride in helping customers form strategies to achieve their growth objectives, partnering with manufacturers aiming to enhance their process capabilities and facility design, as well as with multinational corporations seeking expert consulting for expansion and optimisation projects.
Leveraging over 25 years of industry experience, RMR Process has developed a scaling model that supports growth while adapting to the dynamic market landscape.
This model helps manufacturers make cost-effective decisions about expanding their capabilities while managing associated risks.
Before the onset of COVID-19, manufacturing industries primarily focused on streamlining or optimising their process lines.
Today, however, the landscape has shifted.
As businesses navigate the complexities of the post-pandemic world, they are expanding and enhancing existing process lines to boost throughput capacity, aiming to meet heightened demand while managing operational costs.
Peter Taitoko, director of RMR Process, is seeing first-hand this ongoing transformation of the food and beverage manufacturing industry.
The pressure on food manufacturers today comes from all directions, including high supply chain costs, margin pressures from retailers, high energy costs and compliance costs.
For those needing to expand operations the challenges extend to high construction costs, onerous town planning conditions and lengthy planning processes.
The post-pandemic era has driven a transformation towards local manufacturing, driven by both necessity and cost-saving measures.
Many manufacturers are experiencing unprecedented activity due to the demand for locally produced food and beverages as well as emerging growth channels such as direct-to-consumer products.
Companies that are well-positioned with high-demand products, like ready-to-eat meals and convenience foods, are facing soaring demand and struggling to keep up.
Conversely, those not adapted to the current market conditions are struggling. This development reflects a “two-speed economy” in the food sector.
Both ends of the spectrum are increasingly looking to increase output and reduce costs. Optimising the balance between operational staff and automation remains critical.
This development arises from a dual challenge: while governments push for job creation, manufacturers grapple with high labour costs and a shortage of suitable workers.
For example, most grant funding options target job creation rather than how Australia’s high-quality products for local and overseas markets can be lever-aged, creating a stronger food and beverage industry and supply chain through non-traditional channels.
This has created tension between the desire for more employment opportunities and the necessity of using automation to control costs.
As a result, manufacturers are striving to find an ideal balance between operational staff and automation.
“More and more we’re looking for opportunities to speed factories up and increase process throughput and reliability before we consider capital intensive facility up-grades or new builds,” said Taitoko.
Every factory has unique needs, which is why the initial step in RMR’s model is to encourage the manufacturer to consider a pivotal question, if they maintain the same number of operational staff but increase productivity, would that be appealing? The typical response is ‘yes’.
“Although our core business is designing and building food factories, we always start by minimising or eliminating the need for construction simply because of cost and the fact that the food industry tends to move at a much faster pace than the construction industry and local councils” said Taitoko.
While full automation is feasible for large high-end companies, most local businesses lack access to such advanced technology.
Therefore, the focus is on enhancing process efficiency and accelerating operations while retaining essential human roles in a staged approach.
“We start by reducing or removing labour-intensive repetitive tasks and providing automated solutions where it is practical and affordable” said Taitoko.
“Our intention is not necessarily to remove labour from factories, rather to increase productivity and increase outputs with existing staff numbers.”
Upskilling is a crucial aspect of this transition.
Workers are trained to move from manual roles to more technical positions, such as line technicians.
Staff may be redeployed to roles in raw materials handling, packaging, or distribution.
Alternatively, they are upskilled for quality control positions. The approach aims to make the most of the existing workforce while adapting to evolving demands.
The focus then changes to enhancing facility performance with the current workforce and infrastructure.
For instance, by incrementally increasing the instantaneous throughput of key capital equipment throughout the entire process and adding automation capability to help smooth out the line performance, you can gain significant upside in production volumes, in some cases many times existing capability.
Taitoko said RMR Process has a string of examples of working with clients where throughput was significantly increased without adding extra operational staff or expanding the facility.
These cases underscore the potential of optimising existing operations rather than constructing new facilities allowing companies to scale in control.
If new products are desired, a modest investment to modify the existing line might be proposed.
This strategy emphasises leveraging existing facilities, equipment, and workforce effectively, rather than relying solely on facility expansion.
COVID-19 has also exacerbated global supply chain issues, complicating the ongoing procurement of
imported ingredients.
In response, manufacturers are exploring ways to add value to these ingredients domestically and this should have a positive long-term impact on the industry.
For example, efforts are being made to source and mill dried ingredients locally, leading manufacturers to explore local value-adding processes, whether through co-manufacturers or by maximising their own facility through in-house development.
The challenge extends beyond local production.
The Australian food industry struggles with the underutilisation of its potential, particularly regarding exports.
“We need to do better at leveraging off our high-quality products and increase our own value-adding opportunities from ingredient supply to finished goods,” said Taitoko.
The prevailing mindset of exporting primary produce with minimal value addition persists, despite the government’s focus on manufacturing jobs rather than strengthening existing industries.
“It’s rather like watching iron ore get shipped off only to import it back as ball bearings a year later. In food we need a total mindset shift towards a local supply chain that keeps up with rapidly changing local and overseas consumer demands,” said Taitoko.
However, funding remains an obstacle, exacerbated by the withdrawal of manufacturing grants during the last election cycle.
Meanwhile, Taitoko said, relying solely on government support is not always a viable strategy but thankfully there are alternative funding options available that are more accessible today than ever before, however it is still critical to remove unnecessary costs from expansion projects.
The introduction of the RMR process is a unique advantage that helps offset the challenges posed by lower labour costs and cheaper manufacturing overseas.
“We believe the primary reason manufacturing has traditionally moved offshore is due to the high capital cost to establish a site and we’ve seen many projects abandoned because of this,”
said Taitoko.
“Companies need to demonstrate that they will get a return on their investment.”
Over the past two decades, RMR’s model has resulted in numerous projects being salvaged by managing to remove traditional roadblocks and find alternative scaling options.
“For instance, a project initially quoted at $24 million was reduced to $13 million,” said Taitoko.
“It must be said that this is not necessarily by finding cheaper builders for example, but rather by finding smarter ways to expand such as staging the project over a number of phases to facilitate a controlled expansion over a longer time frame and still allowing the manufacturer to scale their operations.
“We have many of these examples. Such cost reductions are achieved by designing fit-for-purpose processes without inflating costs or enriching construction companies or equipment manufacturers.”
The model has also enabled some food manufacturing to be repatriated back to Australia once a positive return on investment was achievable.
“Our model suits all size companies and off the back of industry challenges and the need to increase local supply, we’ve not experienced this much activity in the industry despite a lot of companies struggling at the moment,” said Taitoko.
As companies increasingly seek more efficient ways to manage projects, the role of specialist consultants becomes crucial.
The post-pandemic era has seen an increase in workload for manufacturing consultants as the reputation of consulting firms extends beyond local borders. This recognition underscores the importance of specialised consulting in navigating the complex landscape of modern manufacturing.