Coshocton now bacon central for Kraft

01-09-2015

Everything’s better with bacon — including Coshocton. Yesterday, Kraft Foods Group announced it is consolidating its Oscar Mayer bacon production and distribution operations in this former canal town about 75 miles east of Columbus. The expansion of the Coshocton plant will entail an investment of about $43 million in construction, machinery and equipment costs and add about 300 jobs generating about $8.7 million in payroll for the area, essentially doubling the facility’s size and workforce. The announcement was a shot in the arm for the community. “We’ve lost so many of our manufacturing jobs — about 42 percent in the last 10 to 15 years,” said Dorothy Skowrunski, executive director of the Coshocton Port Authority, which helped to broker the deal to keep Coshocton making bacon. “People have been having to drive to Columbus and Zanesville to find jobs. With the expansion of Kraft, people can finally come back home to work.”
For more than 30 years, a portion of Oscar Mayer’s bacon has been produced in Coshocton. The plant opened in 1983 with two production lines and 70 employees. Since then, it’s expanded to 370 employees and five lines producing and distributing about two-thirds of Oscar Mayer’s 10 varieties of bacon. In the spring, Kraft Foods Group, which owns Oscar Mayer, began discussions about consolidating its two bacon operations, the other located in Kirksville, Mo. Both locations began putting together incentive packages to keep production in their towns. With help from JobsOhio and the city of Coshocton, Kraft chose to expand in Coshocton. The port authority offered a 10-year, 75 percent property-tax abatement on the expansion project and worked in conjunction with JobsOhio to secure a 10-year, 60 percent Job Creation Tax Credit through the Ohio Tax Commission. JobsOhio also will contribute employee-training dollars to the incentive package. The city of Coshocton offered a job-creation grant, returning 50 percent of the company’s city income tax to Kraft Foods Group for 10 years. Kirksville’s employees were notified this week that its bacon production would be phased out by the end of 2015.
“Consolidation makes better use of our bacon manufacturing assets,” said Kraft Foods Group spokeswoman Joyce Hodel. “It’s a move to build manufacturing scale and lower overhead and total production cost.” Kraft Foods Group generated about $18 billion in revenue last year. Oscar Mayer, which also produces hot dogs and lunch meats, contributed more than $1 billion to that figure. Oscar Mayer is the top-producing bacon brand in the country, and it’s on the rise, Hodel said. “The category has been growing broadly over the last few years,” she said, “into fast food, fine dining. There’s even bacon ice cream. Bacon is on a roll.”

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