General Mills will close a Blue Buffalo plant in Independence, Iowa, by the end of the year as the CPG giant’s pet food unit battles inflation and other supply chain pressures.
The plant produces the pet company’s various Top Chews and Nudges treats brands, which General Mills acquired from Tyson Foods in 2021 for $1.5 billion. The company will provide career services and benefits support to the 250 employees being impacted by the closure, General Mills Spokesperson Kim Limberg told Manufacturing Dive in an email.
“While never an easy decision to close a manufacturing plant, these changes are in direct support of our Pet supply chain strategy, which supports the long-term growth of our business,” General Mills Spokesperson Kim Limberg told Manufacturing Dive in an email.
Limberg said the closure will not impact General Mills’ other Blue Buffalo manufacturing facilities in Joplin, Missouri and Richmond, Indiana. General Mills acquired the Blue Buffalo brand in 2018 for $8 billion.
The food manufacturer’s pet segment saw a 14% increase in sales in Q3 as a result of improved customer service and rebuilding its inventory levels. However, operating profit was down 7% due to inflation and increased costs related to capacity and service improvement, CFO Kofi Bruce said in a March earnings call.
Still, Bruce said General Mills remains on track to deliver double-digit sales growth in the pet segment in the second half of fiscal 2023.
In February, General Mills announced at the Consumer Analyst Group of New York 2023 Conference that it was renovating its Blue Buffalo wilderness dry dog food line and expanding its Tastefuls cat food line. The company also plans to bring the Blue Buffalo brand to China and other international markets in fiscal 2024.