Sweetheart Cup Co. will close its Lafayette, Ga., thermoforming plant in early December, the last in a series of cost-cutting consolidations.
On Oct. 1 Sweetheart told the 101 employees at the northern Georgia site that it gradually will shutter the plant and shift equipment to other Sweetheart facilities, said Daniel Carson, vice president and chief administrative officer.
Equipment will go to plants in Conyers, Ga., and North Andover, Mass., both of which are reconfiguring to accommodate the lines, Carson said. The plant tentatively is to close Dec. 1, according to a source in Georgia familiar with the closing.
The move is part of Sweetheart's goal of shifting production to its larger facilities, Carson said.
``Lafayette is a very small operation that we purchased a couple of years ago,'' he said in an Oct. 2 telephone interview. ``It made sense to integrate equipment into larger facilities that have room for further production expansion and are dedicated to plastics products. The restructuring will help us to remain competitive.''
Sweetheart, based in Owings Mills, Md., launched its restructuring program in 2001. It shut injection molding plants in Manchester, N.H., and Somerville, Mass., and moved some equipment from its Springfield, Mo., molding facility.
Meanwhile, Sweetheart added machines at larger sites in North Andover, Chicago and Owings Mills.
The maker of disposable cups and other food-service items hopes the moves will be reflected in its balance sheet. Through June 30, the first 39 weeks of its current fiscal year, Sweetheart recorded a loss of $7.1 million on sales of $957 million.
Expenses included $7.6 million in costs to consolidate and improve its manufacturing facilities.
Sweetheart purchased the 147,000-square-foot Lafayette plant in 1999 from Imperial Cup Corp. to gain manufacturing lines, Carson said. At its peak the facility had 236 workers, according to a published news report.
The facility primarily produces thin-wall cold cups, many of which are used for Sweetheart's Go Cup brand, Carson said.
News of the closure dismayed the Georgia community, where Sweetheart is one of Walker County's largest employers.
``No community, large or small, wants to lose an employer with more than 100 employees,'' said Cynthia Simonds, president of the Walker County Chamber of Commerce in Rock Spring, Ga. ``But it's part of corporate America as we know it. Companies have to look at the bottom line.''
About half the plant's workers are temporary; permanent workers will be offered a severance package, he said.
Sweetheart officials do not plan any further consolidation moves as part of its restructuring, Carson said. ``We're well-positioned in the marketplace to take advantage of opportunities that come our way,'' he said.