$70m facility opens to tap global appetite

DPM Tharman, accompanied by Mr Kwan (left), being shown how a high-pressure processing line works. Mr Chan (right) said the machine could increase the shelf life of The Soup Spoon's soup sachets from two weeks to three months, which would allow the c
DPM Tharman, accompanied by Mr Kwan (left), being shown how a high-pressure processing line works. Mr Chan (right) said the machine could increase the shelf life of The Soup Spoon's soup sachets from two weeks to three months, which would allow the chain to export the product.ST PHOTO: JONATHAN CHOO

Food makers can use its high-tech, integrated services in Jurong to scale up for overseas

A local firm has opened a $70 million state-of-the-art facility, bringing food logistics, production and services under one roof.

The facility in Jurong looks poised to transform the way local food manufacturers go about scaling up their operations for internationalisation.

Singapore-based investment holding firm Commonwealth Capital, with stakes in home-grown brands such as The Soup Spoon, Udders, Pastamania and Roxy Laksa, opened its massive 300,000 sq ft headquarters yesterday.

Other than hosting some of food manufacturing's most high-tech innovations, the integrated facility will also improve logistics processes, increase time savings and provide economies of scale for food production.

Deputy Prime Minister Tharman Shanmugaratnam, who was guest of honour at the launch, said that Commonwealth Capital is showing "a very important way" for the food industry to develop.

"I think that is an important way forward - retain the character and diversity of our industry but go for sharing of services, go for back-end systems that involve larger investors coming in and smaller players being able to leverage those systems," he said.

Mr Andrew Kwan, group managing director of Commonwealth Capital, said internationalisation is a key driver for the creation of the facility. "This facility was built for international markets. If it was just for the domestic market, we would be under-utilising it."

The company hopes to derive at least 50 per cent of its revenue from exports in the next two years - a major increase from its current share, which Mr Kwan said was "very little".

While more than half of its production is for its in-house brands, Mr Kwan expects this proportion to skew towards external brands as the facility ramps up production for exports.

It currently produces pastries, meat, seafood and ready-to-eat meals like nasi lemak for both in-house and external brands. Brands under the group serve 24,000 meals daily to its 151 cafes and restaurants in 12 countries.

Mr Kwan said that the company is targeting Asia-Pacific, as well as the Middle East as the facility is halal-certified.

The facility boasts Singapore's first high-pressure processing line, a $2-million equipment which will increase the shelf life of food while retaining its nutritional quality.

Mr Andrew Chan, managing director of the Soup Spoon, said it could increase the current shelf life of The Soup Spoon's soup sachets from two weeks to three months, which would allow the company to export the product.

Other brands are welcome to try the technology on a pay-per-use basis, he said, adding that they will be starting a masterclass for the use of the technology.

The building also boasts a fully automated 13-storey warehouse which has a computer-controlled system. It does not require any manpower to place and retrieve items inside the minus 28 deg C storeroom.

The facility also helps brands to reap economies of scale. Mr Kwan said that a Singapore chain with 30 to 40 outlets "is just a start-up" in markets like Japan or the United States, and would not be able to compete on price competitively.

As a result, raw material requirements such as flour and eggs are consolidated at the facility to allow the different brands to enjoy economies of scale.

Mr Kwan emphasised that "Singapore Inc has a unique proposition" because of its credibility in food safety.

"We are very focused on helping local brands that have shown a lot of potential to scale up, and to go overseas as well - that's a bit of national service that we are doing."

A version of this article appeared in the print edition of The Straits Times on January 12, 2017, with the headline '$70m facility opens to tap global appetite'. Print Edition | Subscribe