Gardenia to invest up to P600 million in Cebu plant

CEBU CITY, Philippines — Leading bread manufacturer Gardenia Bakeries Philippines Inc. is investing an additional P500 to P600 million to better serve its customers in the Visayas and Mindanao.

In an interview with reporters on the sidelines of yesterday’s inauguration of Gardenia’s P150-million refurbished plant here, company president Simplicio B. Umali Jr. said that the move was in line with the company’s aim to distribute Gardenia bread all over the country.

The Cebu plant, which started operations last December, has a capacity of churning out 50,000 loaves per day. Currently, the plant is not yet operating at full capacity with production at 40,000 loaves per day.

Aside from serving the Visayas market, Umali said the Cebu plant will also deliver Gardenia products to various provinces of Mindanao including Butuan, Iligan and Davao. Umali said that 60 percent of the plant’s output goes to Cebu and the remaining is divided between Bohol and Mindanao.

Depending on the demand, Umali said that they have two options either to fully automate their Cebu plant thereby tripling the plant’s capacity or put up a plant in Davao in order to expand their Mindanao operations to General Santos City.

Umali said that more than half a billion pesos will be needed for this project and they expect the expansion in two or three years time.

Umali said the company decided to establish a plant in Cebu in order to directly service their clients in the Visayas. Currently, Gardenia products are only available in some provinces through cargo delivery.

The Cebu plant is expected to produce 2,000 loaves per hour or a daily capacity of nearly 50,000 loaves. Umali said the 3,000-square meter factory can be expanded by another 3,500 square meters.

“We are here for the long haul,” he said, adding that they would likely to expand to 4,000 loaves of bread per hour depending on market demand.

Initially, the plant will employ 100 people.

Initial products to be churned out by the Ceby facility include Gardenia’s classic White Bread, High Fiber wheat bread and some flavored loaves.

Umali said that if the Cebu plant runs successfully, they will further expand with a similar plant in Davao in two years time. The main Gardenia factory is located in Laguna.

“With the factory, we aim to be the market leader in bread for Cebu,” Umali said. He added that the Cebu plant will also serve the bread requirements of Bohol, Cagayan de Oro, Malaybalay, Butuan and Iligan, noting that robust demand in the Visayas and Mindanao pushed the firm to rapidly embark in the Cebu plant.