Newport bakery closes with 161 job losses

By Noli Dinkovski contact

- Last updated on GMT

Bakery closure: Avana ceased general production last Friday (Flickr Live4Soccer/(L4S))
Bakery closure: Avana ceased general production last Friday (Flickr Live4Soccer/(L4S))

Related tags: Sisters food group, Baking

A bakery in Newport is to close with the loss 161 of jobs after its owner said market conditions had meant the business was no longer viable.

Avana Bakeries ceased general production on Friday (January 27), with a handful of staff expected to stay on to work on the specialised cake division, according to its owner Food Utopia.

The company told FoodManufacture.co.uk last month that the bakery – which made celebration cakes and puddings – was “unable to make sufficient progress”​ in an increasingly competitive market.

Avana Bakeries was “loss-making” ​and “financially unsustainable”​, Food Utopia said.

Food Utopia had launched a 45-day consultation before Christmas about a proposal to cease production at the Rogerstone plant by the end of January 2017.

Repeated job losses

The former 2 Sisters Food Group site had suffered repeated job losses following the loss of a major contract with Marks & Spencer in 2014. Food Utopia bought the site later in the same year.

John James, organising regional secretary at the Bakers, Food and Allied Workers Union, confirmed to FoodManufacture.co.uk that 161 workers had been made redundant.

He claimed to be “disappointed”​ that people had lost their jobs, particularly given that Avana was in the process of developing a £7M a year contract with an unnamed customer.

“The company had a five-year plan that expected to lose money in the first two years, but the owners have pulled the plug after little more than two years because they said they don’t see it making any money,”​ James said.

‘They needed to double their turnover’

“They say they needed to double their turnover. Their turnover was £14M – so the contract will have taken them halfway there. At the same time, they lost a contract last year because they failed to deliver it on time."

The bakery, which opened in 1958, was bought by Premier Foods in 2007 before being sold to 2 Sisters Food Group four years later.

Food Utopia proposed 390 job losses​ one month after it took over the factory in August 2014.

No one from Food Utopia was available to comment.

Related topics: Bakery, Cereals and bakery preparations

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