Productivity 2 - Improving your business' profitability - ANZCO Foods
ANZCO’s systematic cost reductions delivered greater profit even where margins were tight.
Margins in the meat industry are tight, but ANZCO Foods Ltd are continuing to deliver high quality meats, while tightening costs. Through a programme of continuous improvement, they’ve reduced energy use by 16%, which has delivered a saving of $2.6 million per year, and 14% less carbon emitted.
Cutting energy waste delivers an immediate boost, the same production at lower cost. How you measure productivity will depend on the business you're in.
Driving profitability is important to every business, especially in competitive ndustries. More efficient use of energy in your operation can help shave costs, boosting margin and bottom-line profit. It can also help you deliver on sustainability goals.
ANZCO Foods has a corporate policy with seven pillars. Journey for Good relates to their energy use. ANZCO Foods aims to be a more sustainable company. This means reducing costs and carbon footprint, improving brand power and meeting overseas standards. We've entered this process to reduce our bottom-line cost by energy management.
Our industry is a low-margin industry, so we're looking for low cost of production. So any opportunity to reduce those costs are identified. So as part of the EECA audit, it was identified that there was hot water going down our drains. We identified this as a possible opportunity for energy savings initiatives.
The business case presented was very successful because we were able to identify the bottom-line savings, which relates to our body costs. We are in a very intensive industry with very high overheads and operating costs. By presenting a strong case, the senior leadership team and the board accepted the cost savings and the reduction in their bottom line.
We've got a lot of existing equipment on site. By correctly managing it, introducing new technology, SCADA systems, programmable logic controllers and real-time monitoring, we've been able to gain significant cost savings.
Our target goal was to save 36 gigawatt hours in five years. ANZCO Foods was able to save this in two years, so our overall energy savings reduction was 16%, our overall savings per year was $2.6 million, and we've reduced our carbon emissions by 14%. Increased productivity helps businesses prosper, which is good for the economy, and that in turn is good for the whole of New Zealand.