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Morrison Lamothe Inc. is a co-manufacturer of foods for large national and international branded companies and a co-packer and supplier of private label products to the frozen food industry. David Soyka packages a report on this chilling topic.

A successful business has to learn to change with the times, or be left behind the times. A case in point is Morrison Lamothe, a third-generation family-owned business that back in the 1960s was the largest bakery in Canada, while also holding interests in restaurants and catering, as well as frozen food manufacturing. But, by the 1990s, the company wound down its bakery operations as well as all ancillary businesses to focus on frozen food manufacturing. Celebrating its 75th anniversary this year, Morrison Lamothe is trusted by large, international brands to make frozen food products that live up to and extend their brand reputations. Indeed, Morrison Lamothe is North America’s largest private label and contract manufacturer of meat pies and pastries, as well as Canada’s single largest producer of frozen entrees and dinners. In addition, Morrison Lamothe has received multiple awards as one of Canada’s 50 best managed private companies.
“Our initial investments were designed to position our capabilities as an efficient, low-cost producer specializing in frozen meat pies and dinners,” says Shawn Dellevoet, director of business development. “Expansion and modernization of our suburban Toronto plant allowed us to acquire the Holiday Farms brand in 1984 and move into the frozen entree category. As part of our broader corporate strategy to serve the growing co-pack and private label segments of the frozen food market, we acquired Northern Fine Foods in 1990. Today, we are a co-manufacturer for leading private global brands and a co-packer for private label products. The products we make are distributed through retail and foodservice channels throughout North America as well as internationally. It’s a global marketplace today, and Morrison Lamothe is very much concentrated in serving the international interests of major brands which depend on us to fill certain categories within their frozen food product lines.”

Morrison Lamothe specializes in two categories: pastry products and frozen prepared meals. Pastry products include appetizers, hors d’oeuvres, snacks, hand held and convenience foods, meat pies (traditional, gourmet and fusion) and other specialty items. Frozen meals include single-serve pasta, compartment dinners, healthy and ethnic entrees, breakfast items, and rice, potato and pasta bowl entrees.

Dellevoet says that customers rely on Morrison Lamothe for a variety of reasons. “Could be they had a product under development that for whatever reasons – limited time, insufficient resources, cost-effectiveness – they can’t manufacture on their own. So, we make it happen for them. At the other end of that, we have eight in-house product developers dedicated to work with major brands to design new products that support and extend the brand. One of the things we do is a marketing plan that identifies gaps in the product line and how they can best be filled.”

She adds, “our role isn’t simply that of a supplier. We design custom solutions that satisfy customer objectives. Sometimes the solution is focused on speed-to-market. Sometimes it’s to refresh or broaden a brand category. Or, it could be both. Individual solutions are tailored to what the customer needs to achieve. In addition, as part of any solution, we provide nutritional guidance, package design, regulatory approval guidance and cross-border and international logistics expertise.”

VALUE CREATION

Leading global brands and private label manufacturers rely on Morrison Lamothe for a number of good reasons. “We’re a relatively small, entrepreneurial company,” Dellevoet says. “There’s not a lot of bureaucracy to deal with, which is related to our rapid launch capability for customers who require product in less than eight weeks.”

Moreover, she points out, “We create value for our customers through our account management brand experience, our expertise in various forms of pastry production, our capability to manufacture fillings and sauces in-house, our supply chain integration with customers, and our government inspected facilities that ensure high quality and safety.”

Morrison Lamothe has three world-class, technologically advanced food processing facilities in the Toronto area, all steeped in lean manufacturing processes and Six Sigma practices. The company can operate with only about 150 employees because most of the production processes are highly automated.

“The two meat production facilities are operated under stringent HACCP (Health Care Consumer Assistance Program) guidelines for FSEP (Food Safety Enhancement Program) and are federally inspected by both the CFIA (Canadian Food Inspection Agency) and the USDA (United States Department of Agriculture). Our programs meet or exceed all regulatory and third party auditor requirements. Products are on a ‘positive release’ program tested by an independent lab verifying its safety,” Dellevoet says.

“We take our commitment to food safety very seriously,” she points out. “Our employees are regularly trained in Good Manufacturing Procedures (GMP). Our plants are regularly audited by independent third party agencies. We align ourselves with suppliers who share our philosophy on food safety. Our programs ensure we produce quality, safe food products for the consumer.”

At the same time, Dellevoet emphasizes the company’s concern with the safety of its workers. “Morrison Lamothe is dedicated to achieving and continuously improving a healthy and safe workplace for its employees. A comprehensive occupational health and safety program is established, supported, maintained and integrated with the company’s operational activities. This supports achieving both organizational and operational excellence.”

While Dellevoet says a significant amount of the company’s business is in the United States, current economic conditions below the border are having little effect on sales. In fact, as a Canadian company, Morrison Lamothe is actually in a good position. “At current exchange rates we are a less expensive supplier to companies outside our borders because the Canadian dollar is a better buy.”

RISING CHALLENGES

She notes, “Unquestionably, prices of both raw materials and production are up. There a number of reasons for this. First, the cost of oils, flours and grains are rising across the board. We’re talking double digit increases. This is the first time we’ve seen anything like this.”

Dellevoet explains that “one of the factors driving this is the market for ethanol. More fields are producing corn that is going to ethanol production, not to feeding animals or for other foodstuffs. So, that’s driving prices up. On top of that, the increasing price of oil and gasoline means transportation is more expensive. So, that’s added costs to get raw materials to us that are already more expensive than they’ve ever been.”

Because Morrison Lamothe epitomizes the small and lean approach, it offers customers certain cost efficiencies, but even these hardly wipe out the serious hikes in pricing. “Generally, there are two ways to address this,” Dellevoet says. “One is to reformulate the product to try and stay at the same price point. The problem with that is it can potentially denigrate the product and the brand. The other is to move to higher price points and maintain the integrity of the product. Of course, we’ll do whatever the customer wants. Most of our customers, though, opt to maintain the same quality at a higher price. If you’re a leading international brand, you don’t want to fool too much with consumer expectations. If you denigrate a product’s quality, you risk losing your customer base that comes to equate the brand name with certain characteristics that, if you change them, also risks denigrating the entire brand line.”

At the same time, brands need to address new consumer trends, in particular environmentally friendly packaging and healthier foods. “There’s certainly more consumer awareness of these issues and we’re developing more solutions with these in mind,” Dellevoet says.

For the immediate future, Morrison Lamothe sees continuing opportunity as a frozen foods co-manufacturer and co-packer. “You never say never,” Dellevoet says about the possibility of expanding into other categories or services. “After all, we started out as a bakery business and look where we are today. However, our customers are confident in our ability to develop and produce products that enhance their brand image around the word.”

When you have a track record of success, you like to stay on track. The trick is to move forward with the times on that track. Morrison Lamothe continues on its way.

Volume:
4
Issue:
4
Year:
2008


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